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How do I calculate mileage as a business expense?

It is important to keep a small notebook in your car or use a mileage tracking app to track mileage, travel to clients, customers, business meetings, traveling to a temporary workplace.

You can generally calculate the cost of your deductible car expense using  the Standard Mileage Rates  method or the actual expense method.

For each year the standard mileage rate has been used, you must multiply your business mileage for the year by the amount shown in the chart, and then reduce your car’s tax basis (and increase your potential taxable gains) by that amount.

For 2017, the standard mileage rates are:

  • 53.5 cents per mile for business, down from 54 cents in 2016
  • 17 cents per mile for medical/moving, down from 19 cents in 2016
  • 14 cents per mile for charity, the same as in 2016

Year Rate Per Mile Dates Covered

2017 53.5 cents 01/01/2017 – 12/31/2017

2016 54 cents 01/01/2016 – 12/31/2016

2015 57.5 cents 01/01/2015 – 12/31/2015

2014 56 cents 01/01/2013 – 12/31/2013

If using the actual expense method, you must determine what it actually costs to operate the car for the portion of the overall use of the car that’s business use. Include gas, oil, repairs, tires, insurance, registration fees, licenses, and depreciation (or lease payments) attributable to the portion of the total miles driven that are business miles. Also keep note that other car expenses for parking fees and tolls attributable to business use are separately deductible, whether you use the standard mileage rate or actual expenses.

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