Are you on business trips too often? Do you spend too many hours calculating the miles you drive and the fuel costs for tax reimbursement?
If yes, you are on the right spot! We will let you in on the most beneficial part of using the mileage tracker app, and you can thank us later.
Haven’t heard of Mileage tracker before?
Mileage tracker app like Simply Auto is the new saviour for business travellers who face the need for logging the driven miles, fuel costs, toll fees and other expenses incurred at the time of travel.
This has become quite popular now, and we will see in-depth how mileage tracking app can help us with tax deduction.
Benefits of Mileage Tracking
Some of the best uses of mileage tracking are,
- Accuracy in logging
To err is human, but imagine the errors some miscalculation brings along. Mileage tracker app comes to the rescue recording accurate logs and keeping in tab the toll costs and fuel expenses. At the time of tax submission, the report comes handy with zero efforts.
- No to Stress and Yes to Productivity
Have you experienced the pain of going over the business trips in detail? The total miles you drove, the fuel costs with n number of other expenses., again and again.
On average, it takes almost 20 hours annually for a single person to log in their mile logs and other costs. Imagine the hours it will take for an entire year.
Now that mileage tracker keeps tabs on mile logs and other costs incurred during the drive manually, you can focus on other things that matter. In case of logging multiple entries, the mileage tracker can handle the stress professionally.
- Records Business trips
Did you know that with mileage tracker you can keep track of the business trips like the date and time of travel along with places visited automatically when you travel?
What is more beneficial is that you can review this data as and when needed. When you cannot keep hold of the information manually, mileage tracker helps you maintain them in a more organized way.
- Tax- deduction with Mileage Tracker
Now comes the main picture, tax deduction with mileage tracker is the talk of the field. Claiming a tax deduction for business has never been easier than now.
All you have to do is choose between the methods that pay you more. In detail below, we have explained the two ways by which you can claim tax- deduction for the business miles travelled.
The first simplest method is using the standard mileage rate*. According to the reports of IRS**, Standard mileage rate for 2020 is 57.5 cents which means for every 1000 miles, you can deduct $575 from your tax, i.e. multiply your total miles with 0.575, and the result is your tax deduction amount.
The other method is the usual way of deducting the expenses incurred for your vehicle during the whole business trips throughout the year. For both the methods, mileage tracker will have your record and do the math to find whichever is higher can be claimed.
How to choose the right mileage tracking app?
For your convenience, we have come up with the list of criteria to be considered while choosing the right mileage tracking app.
- Automation being an essential factor in any business, make sure to choose one that has automated forms which can calculate expenses quickly.
- Always look for additional features offered, such as the amount of time one has worked as in the latest apps. This helps you keep tabs on productivity.
- The app should be able to keep a record of the receipts and the ability to scan and save the receipts for reviews.
- If the app can be customized to meet your needs, that is an added advantage. Choose the one that suits you best so that you don’t have to pay more.
- Business miles are deductible on your tax return, and you can claim your business trips by demanding mile reduction. Tracking your mileage can help you create tax savings.
- The actual expenses related to the vehicle can be deducted with the help of things like lease payments, fuel costs, and insurance. You can deduct the portion of those expenses that apply to your business miles.
- The IRS standard mileage rate helps you by letting you use a flat rate to calculate the value of your deduction.
- Mileage tracking apps give you an accurate value when it comes to mileage and is more reliable than other human systems.
- The data is always available to you on your smartphone to review, revise and edit at any time.
- These apps are user-friendly and easy to use. They help you save time by calculating your mileage and keeping a record of your data.
Thus, Mileage tracker apps like Simply Auto help not only maintaining the mile logs but also with the reimbursement of business miles. Choosing the right mileage tracking app is essential and select the one that meets your business needs promptly.
Want to know more about Simply Auto app for your business needs, feel free to reach us anytime!
*Standard Mileage rate:
The standard mileage rate (SMR), also called the mileage per diem, is the amount per mile that the Internal Revenue Service (IRS) permits small businesses and self-employed individuals to utilize to calculate their vehicle expenditures for tax deduction goals.
Internal Revenue Service:**IRS: The Internal Revenue Service (IRS) is a U.S. government agency accountable for the collection of taxes and enforcement of tax laws. Established in 1862 by President Abraham Lincoln, the agency governs under the authority of the United States Department of the Treasury, with its primary purpose comprising the collection of individual income taxes and employment taxes.