Save Gas Receipts or Record Mileage for the IRS ?

[ENDURO]

Do I need to also save my gas receipts for my truck, or just record the mileage. I would assume you couldn't use gas receipts since there would be no way for the IRS to prove that you were not saving gas receipts for all of your cars. Also, with recording the mileage, are there special rules the IRS wants me to follow? Do I need to record the start and stop mileage or just the number of miles driven that day? Do I need to record the addresses I visited or just the date? Anything else they require as far as documenting your vehicle use? Thanks.

[scott's turf]

Are you using this vehicle for both business and personal use? If so you want to keep a detailed log book of your mileage.

[Cahsking]

This may help...it is a little monthly newsletter for small businesses.

http://www.irs.gov/businesses/small/article/0,,id=105708,00.html

[PJDiesel]

I never even push the "Print Receipt" button at the pump.

You're best write off is by mileage anyway, no sense in keeping hundreds of receipts you are never going to be asked to produce anyway. Besides, aren't we all using Check/Debit or Credit cards these days anyway? (All your documentation is right there in an organized fashion.
Don't stress about the IRS, I have been 1099'd on two and three different businesses I own or own part of for years now. IRS has yet to fool with me. Use common sense, but also don't let yourself get beat for money you spent doing "Business" either.
In short, get a good accountant, worth every penny.

[Mower For Less]

You're best write off is by mileage anyway

That is a horrible blanket statement to make. There are WAY to many variables to say that mileage is better. It, like everything, depends.

What kind of car/truck, fuel economy, new vehicle or old beater, miles driven per year, insurance rates and gas prices, maintenance costs, etc, etc...

Different circumstances will produce different results for the bigger deduction. I have had vehicles come out better on the mileage deduction, but most of the time I do much better with actual costs.

Hypothetically, say your driving a $40,000 truck. You would need to drive about 18,000 miles just to cover the depreciation allowance on a actual costs deduction. Then youd have to drive about another 18,000 miles to cover fuel for the whole 36,000 miles. And you havent even paid for insurance yet. And what about when you need new tires next year? Get my point? Now take the flip side, I put less than 20,000 miles on my vehicles per year typically. I would lose my A$$ on a standard mileage rate.

Kevin

[topsites]

Paperwork reduction Act, ca. 1976

= Per mile.

If you're spending more than per mile, then your company runs less efficiently than one whose expenses come in lower than per mile.

[lawnspecialties]

That is a horrible blanket statement to make. There are WAY to many variables to say that mileage is better. It, like everything, depends.

What kind of car/truck, fuel economy, new vehicle or old beater, miles driven per year, insurance rates and gas prices, maintenance costs, etc, etc...

Different circumstances will produce different results for the bigger deduction. I have had vehicles come out better on the mileage deduction, but most of the time I do much better with actual costs.

Hypothetically, say your driving a $40,000 truck. You would need to drive about 18,000 miles just to cover the depreciation allowance on a actual costs deduction. Then youd have to drive about another 18,000 miles to cover fuel for the whole 36,000 miles. And you havent even paid for insurance yet. And what about when you need new tires next year? Get my point? Now take the flip side, I put less than 20,000 miles on my vehicles per year typically. I would lose my A$$ on a standard mileage rate.

Kevin

What you said! I have an '05 $40,000 F-250. I drive about 18,000-20,000 miles a year. Heck, I even spend about $4,000-$5,000 a year in diesel. Not to mention all the other stuff I spend on it (truck boxes, cleaning supplies, maintenance, etc.). This year my CPA recommended we cut back my depreciation amount I could have taken for 2005 and save it for 2006 because it was going to be such a huge deduction.payup

[Mower For Less]

Paperwork reduction Act, ca. 1976

= Per mile.

If you're spending more than per mile, then your company runs less efficiently than one whose expenses come in lower than per mile.

It depends on what your running. The per mile rate is a broad average of all types of vehicles, most with much better fuel economy than your average work truck pulling a trailer, and an average amount of depreciation, again probably based on a vehicle much cheaper than your average work truck. Saying that standard mileage is better is equivalent to saying you can operate a 5 yard dump truck for the same as a Geo Metro. Remember the standard mileage rate is not based on any particular field or vehicle classification. But, if your want to save some paper, take the standard mileage rate all you want. I'll keep doing the math.

Kevin

[lsylvain]

In my current profession as an accountant I will tell you straight up that 90% of the time you are going to come out better keeping your receipts here is a small list of reasons why.

The following is assuming you use milage.

1. No section 179 deduction on your vehicle or regular depreciation
2. No deduction for insurance.
3. No deduction for repairs and maintainance.
4. No deduction for new tires.
5. gas is almost $3.00 per gallon.
6. You are pulling a trailer so your gas milage sucks.
7. It is a whole lot easier put your gas on a credit card than it is to keep up with your milage.
8. You need to keep the recipts and enter them into your bookkeeping so you know how much money you are making anyway.
9. If you use the standard milage rate in the first year you are stuck doing it forever on that vehicle.

10. You have to keep the receipts for your mower gas anyway if you want to deduct it and get the credit for off road use fuel.

11. $3/ gallon at 15 mpg = $.20 per mile. $15,000 truck you use for 100,000 miles = .15 cents per mile. $20 oil change every 2000 miles = .01 per mile. $600 set of tires every 20000 miles = .03 per mile. $400.00 for breaks every 20000 .02 per mile. $1500 for insurance at 20,000 = .08 cents/mile. That totals 49 Cents per mile. In 2005 the SMR was 40.5 cents for miles through August and 48.5 cents after. If you drove 20,000 miles evenly across the first year your SMR deduction would have been $8633 using actual expenses you get $15,000 just with the 179 deduction.

But again it varies from individual to individual so run the numbers yourself just like I did above.

yes, I came up with more than a few.

[mojob]

In my current profession as an accountant I will tell you straight up that 90% of the time you are going to come out better keeping your receipts here is a small list of reasons why.

The following is assuming you use milage.

1. No section 179 deduction on your vehicle or regular depreciation
2. No deduction for insurance.
3. No deduction for repairs and maintainance.
4. No deduction for new tires.
5. gas is almost $3.00 per gallon.
6. You are pulling a trailer so your gas milage sucks.
7. It is a whole lot easier put your gas on a credit card than it is to keep up with your milage.
8. You need to keep the recipts and enter them into your bookkeeping so you know how much money you are making anyway.
9. If you use the standard milage rate in the first year you are stuck doing it forever on that vehicle.

10. You have to keep the receipts for your mower gas anyway if you want to deduct it and get the credit for off road use fuel.

11. $3/ gallon at 15 mpg = $.20 per mile. $15,000 truck you use for 100,000 miles = .15 cents per mile. $20 oil change every 2000 miles = .01 per mile. $600 set of tires every 20000 miles = .03 per mile. $400.00 for breaks every 20000 .02 per mile. $1500 for insurance at 20,000 = .08 cents/mile. That totals 49 Cents per mile. In 2005 the SMR was 40.5 cents for miles through August and 48.5 cents after. If you drove 20,000 miles evenly across the first year your SMR deduction would have been $8633 using actual expenses you get $15,000 just with the 179 deduction.

But again it varies from individual to individual so run the numbers yourself just like I did above.

yes, I came up with more than a few.
So what's the story on the log book? If you keep actual expenses do you also have to keep a log? And if so, how detailed does it have to be? Thanks for all the help.

[lsylvain]

If you use the vehicle for 100% business use, no you don't need to keep a log book, but if you use it for personal use you will need to keep one to keep up with how many miles are buiness and how many are personalal. If you have another vehicle you only use your truck for business use. The only down side to not keeping a log book is should you get audited and the IRS wants to go through the hassle of it they can try to say that you used the vehicle for personal use, and of course the burden of proof is on you.

[Fantasy Lawns]

I'm kinda lucky that my local Shell guy lets me run a "tab" which I pay at the end of the month with a check ... he keeps all the receipts .... we fill the trucks with one pump n mowers with another ....helps me keep detail gallon usage between trucks n mowers

Otherwise I'd use a charge card n pitch the receipt ....keep the monthly ...only issue with this is you can't keep a detail of gallons ... as the price varies ...can't really just use today's price per gallon to figure gallons ...

[lsylvain]

I was going to say that as well Fantasy and I think if you use the "store" card, ie. a shell, exxon, bp, etc. card they will put the gallons on the bill. It has been so long since I have used one I can't remember.

[6'7 330]

Actual expense method for all our company trucks, all miles logged, receipts kept,despite company credit cards.

[SodKing]

Ditto 6'7".............

[lisam]

Dear Enduro,

Record The Mileage, But Check With Your Accountant. You Should Also Save The Gas Receipts For The Gasoline Used "off Road." In Other Words, You Get Credit For The Taxes You Pay On The Gasoline You Use In Your Mowers, That Is, If You Are In A State Where There Are Taxes On Gasoline. Double Check With Your Accountant. We Keep A Separate Ledger Sheet On The Number Of Gallons Per Month, And How Much It Was For That Gasoline Only. Hope This Helps. Lisa @ Power Equipment Warehouse.