One of the many perks of being a small business owner in the United States are the tax deductions.
Over the years, I’ve tracked the miles I put on my vehicle to go to the bank to deposit checks from clients, attend yoga workshops that I write about on my lifestyle blog and, of course, going to meetings, networking events and business conferences.
If you’re not keeping track of mileage for your small business, you’re potentially leaving hundreds of dollars on the table each time you complete your annual tax preparation.
In this blog post, I’m sharing three different ways you can track mileage for your small business.
Disclosure: This blog is reader-supported, which means this post contains affiliate links and advertisements. I earn a small commission if you shop through them, which helps fund this website so I can continue to bring you amazing content. Thank you! ~Angela
Tracker #1: Classic Pen and Paper Notebook Log
When I first started documenting driving for work purposes, I had a notebook sitting on the passenger seat next to me dedicated to my business travels. Each time I hopped in the car, I would log the date and my starting odometer reading. At the end of my driving, I noted the final odometer reading. Then, I did the quick math and put the total number of miles driven at the end of the line.
On the last day of each month, I would add up how many miles I drove and put that number in a big circle at the top of the sheet. At the end of the year, I added up the 12 months and submitted the total number of miles and my notebook sheets to my accountant.
This method is basic, but effective.
If you’re just starting out as a small business owner, it’s worth giving this tracking method a shot to see how much money you can deduct during your next tax filing.
Tracker #2: Accounting Software Tracking Feature
After a few years, and a few lost notebooks, I decided to upgrade my process.
I now track the mileage for my small business using the QuickBooks Self-Employed app. This app is designed for accounting tasks like invoicing and tracking your business spending, but it also features a mileage log. It’s super handy and what I use each time I get in my car for work.
I simply log in to the app and let it run in the background while I’m driving. The QuickBooks Self-Employed app maps my drive and logs the address of my starting point, endpoint, total mileage, and tells me an estimate of my tax deduction for that business trip.
At the end of the year, I print out a report from QuickBooks Self-Employed regarding my mileage and submit it to my accountant. Easy!
Tracker #3: Dedicated Mileage Software App
Of course, if you already have an accounting process in place that you love, you can download an app that is specifically used for mileage calculation. I haven’t personally done this, but I know several small business friends who use this method. It’s very similar to how I use the mileage feature in QuickBooks Self-Employed.
Simply go to the app store on your cell phone and browse mileage apps. Look at the features and see what will work best for your situation. A few popular mileage tracking apps are Stride, TripLog and MileIQ.
Do you track the mileage for your business? Why or why not?
Sometimes I feel like it’s silly for just a few miles here and there. However, over the years I’ve learned those pennies really do add up to hundreds of dollars, which is helpful when you are a small business owner.
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Hi Angela,
It was a great share! I have a small business too, and I try to keep a track of success. I do have a way of tracking mileage that is different than yours, but it works for me. I think keeping track is important, it not only helps me decide the next step but also helps me gain perspective when I feel lost. Some of my friends are starting their new businesses, I will definitely share this article with them so they can find inspiration from it. Thanks a lot for sharing, it was a great read.
Thanks for reading, John! Have a great weekend!