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Mileage Deductions

Deductible Mileage

A self-employed independent contractor (1099) can claim a deduction for miles driven to a job assignment. You cannot deduct miles driven for other reasons even if you drove the same vehicle. The IRS requires you to take relatively straight routes from one location to another. An auditor may not allow you to claim side trips between two points if they added to the total length of your reported deductible use. You can deduct mileage driven for non-work reasons related to the business. This includes driving to the bank to make a deposit and meeting with professionals managing your business.

Reimbursement Rates

The IRS allows self-employed independent contractors to receive a tax deduction for business miles. The IRS sets the reimbursement rate each year and sometimes adjusts the rate after the first six months of the year. This rate, known as the standard mileage rate, provides the taxpayer with a per-mile tax deduction.. Some states also allow you to deduct business mileage when reporting state income tax, but state mileage rates do not always follow federal rates. Some states use the federal rate while others set their own rates.

What Types of Business Driving Qualifies for a Mileage Deduction?

  • Errands/supplies-
    Driving for business-related errands qualifies. This can include trips like going to the bank, office supply store or post office. Additionally, these small trips add up quickly. Many business owners forget to keep track of these drives.
  • Business meals and entertainment-
    Trips you make to meet with clients or vendors qualify for this deduction. This can include drives for dinner, coffee, drinks, etc.
  • Airport/travel-
    The miles you drive to and from the airport for a business trip.
  • Odd jobs –
    Drives to and from odd job locations can be written off. These can include side-gigs like babysitting, pet care, lawn work or more.
  • Customer visits –
    Driving from your office or other work site to meet with customers or clients for business qualifies.
  • Temporary job sites –
    Driving from home to a temporary work location that you expect to last (and does in fact last) less than one year.
  • Job seeking –
    If you’re looking for work, you may deduct the drives to find a new job in your current occupation. Yet, you cannot take this deduction if you’re looking for a job in a new industry for the first-time
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