Mileage Deduction - Irs Rules For narrative keeping

Medicare Premiums Tax Deductible - Mileage Deduction - Irs Rules For narrative keeping

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With today's retreat cheaper and the tax situation uncertain in the future, many population are seeing for as many tax deductible firm expenses as possible. One of the biggest deductions, at least for small and home-based firm owners, is going to be the mileage deduction. But there is something you have to know before you take this deduction. For the mileage deduction Irs rules for record-keeping and documentation are hugely important.

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Medicare Premiums Tax Deductible

You can, of course, look up the mileage deduction Irs rules on the internet. However, to make things easier, if you are seeing to take that mileage deduction in the arrival year here is a guideline for what you need to document. For at least 90 consecutive days, every time you get into your car and drive somewhere, you will need to narrative the following:

- date

- firm for which the miles were driven (if you have multiple businesses)

- destination

- customary purpose of the trip

- beginning odometer reading

- ending odometer reading

- firm miles driven

- personal miles driven

You will want to narrative 90 days of mileage that reflect your typical driving habits because this is what the Irs will use to rule what ration of your driving is primarily for firm or personal use for that year. In 2008, for each firm mile you drive you can deduct 50.5 cents. Now here are some truly cool footnotes about the mileage deduction Irs rules.

1. According to Irs Section 274(d), you don't have to be totally strict about the customary purpose of the trip. If you're destination is "Rudy's Restaurant" and you are there to meet a possible client, you can just enter "business presentation" for your customary purpose. Now documentation for your mileage deduction isn't so complicated.

2. Mileage deduction Irs rules are not picky about you doing some errands and shopping as long as the customary purpose of the trip is business. For instance, suppose Rudy's bistro is in the same strip mall as a grocery store. There is nothing to stop you from doing some quick grocery shopping after your firm presentation at Rudy's. Do not narrative your shopping activities in your mileage log.

3. You can also deduct some personal miles as long as they are for charity, going to or from medical appointments, or inviting to a new job location at least 50 miles away. The rates vary for. For 2008 you can deduct 19 cents per mile for medical or inviting purposes and 14 cents per mile for charitable purposes. You see? Even the Irs will give you some slack when it comes to your mileage deduction.

Mileage deduction Irs rules are not difficult to follow. You just have to be consistent for 90 days to make sure you are covered in case you ever get audited. According to home-business tax advisor Ronald Mueller, chances are that if you keep great documentation the Irs will not hassle you if you get pulled for a random audit. Irs auditors are seeing for population who are trying to avoid paying extra taxes, not population who make use of legal tax deductible firm expenses and keep specific records. Just throw a notepad in your vehicle, be a perfectionist for 90 days, and you'll have your mileage deduction all worked out for the year!

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