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Tax deductions are like Pokemon, you want to catch ‘em all.

And using a mileage tracking app might just be the best shortcut to maximizing your deductions.

While self-employed people often track their work mileage, they don’t always use a mileage tracking app. Instead, some spend too much time and effort on outdated systems—often a combination of pen, paper, receipts, and an odometer.

Even worse, it’s hard to remember to track every single mile. As a result, many self-employed people miss out on valuable tax deductions.

That’s why we want to talk about mileage tracking apps. These apps make it easier than ever to track your business miles, so you have more money in your pocket after taxes. 

Contents

  • Mileage tracking app definition
  • Who needs a mileage tracking app?
  • What are the benefits of tracking mileage for self-employed people?
  • How do I deduct my mileage as a self-employed person?
  • Can I deduct my commute to the office?
  • How can a mileage tracking app help prepare me for taxes?

Mileage tracking app definition

A mileage tracking app is the best way to keep accurate and IRS-compliant mileage logs. By tracking your work miles, you’ll end up with more money in your pocket. 

If you’re self-employed, you’ll be able to write off every business mile tracked at tax time—this means you pay less in taxes or get reimbursed after you file.

The benefits of an app vs. pen and paper

A mileage tracking app is the best way to track your miles. An app with GPS tracking is much easier and more accurate than pen and paper. Plus, it’s easier to keep IRS-compliant records.

You’ll also have your records easily accessible. When preparing for taxes, download your mileage records. Then, hand them over to your accountant or import them directly into your tax preparation software. Money saved! 🎉

Who needs a mileage tracking app?

Anyone who drives for work!

Man sitting behind a table with a sign that says "You need to track your work miles. CHANGE MY MIND."

Employees (W2s) need to remember that the Tax Cut and Jobs Act (TCJA) of 2017 means that employees cannot claim a tax deduction for mileage. Instead, ask your employer if they reimburse mileage! Many organizations do.

Why does a self-employed person specifically need one?

As a self-employed person, it’s important to remember that companies do not withhold any taxes from the income they pay to you. As a result, you’re responsible for paying the Self-Employment Tax for your income.

Because of this tax responsibility, self-employed people need to find ways to lower their taxes. 

And the best way to lower self-employed taxes is to keep track of all your business mileage and expenses with well-kept records. The more deductions you have, the lower your taxable income will be, and the less you’ll owe to the IRS.

What are the benefits of tracking mileage for self-employed people?

The more miles you track—made easier with a mileage tracking app—the more deductions you’ll have at tax time. Once you write off all your business miles, you’ll get to keep more money in your pocket. 

How do I deduct my mileage as a self-employed person?

When it is tax time, you’ll use the Schedule C form to list the number of business miles you drove during that tax year. You’ll also include details about your car.

Can I deduct my commute to the office?

No, your trips to and from an office don’t count as business miles. Instead, you can deduct all non-commuting business mileage.

How can a mileage tracking app help prepare me for taxes?

The best way to prepare for self-employed taxes is to keep track of all your business mileage and expenses with well-kept records. The more deductions you have, the lower your taxable income will be, and the less you’ll owe to the IRS.

Understanding mileage tracking apps

Key Takeaways

  • Mileage tracking apps are easier and more accurate than pen and paper records.
  • Self-employed people need a mileage tracking app.
  • A mileage tracking app can help you keep more money in your pocket (e.g., pay less in taxes).

https://www.youtube.com/watch?v=-cwElIkHNvA

Meet Everlance, the #1 mileage & expense tracker.

Everlance is the #1 app for tracking company mileage & expenses. With Everlance, you can automatically capture your car mileage and business expenses—which likely equal thousands of dollars of deductions. When preparing for taxes, download your mileage and expense records. Then, hand them over to your accountant or import them directly into your tax preparation software. Money saved! 🎉

Your tax situation is unique—just like you! Our Gig Guides represent generalized tax information. If you need help with your specific tax situation, please reach out to your tax advisor.