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Each year
standard mileage rates are set by the IRS. For 2012 they are:
Business
Travel: 55.5¢/per mile
Medical/Moving:
23¢/per mile
Charitable
Work: 14¢/per mile
Too
often this deduction is overlooked because proper documentation was not
followed. Here are a few tips to ensure you receive the full benefit of this tax
deduction.
Tip 1:
Track your applicable mileage in an auto log. This
log is required to ensure your deduction is not disallowed during the course of
an audit. Please make sure the business/charitable/medical purpose, date and
distance is clearly noted.
Tip 2:
Also keep track of parking, tolls and other miscellaneous travel
expenses. These can often be deducted in addition to the standard mileage
rate.
Tip 3:
Submit expense reports if your mileage can be reimbursed. Most
employers will reimburse you for business mileage at the approved rate, but
many employees fail to ask for reimbursement. Remember, your employer can
deduct this reimbursed expense on their tax return as well.
Tip 4:
Keep track of medical miles. Even
though you need to surpass a percent of your income prior to taking medical
expenses as an itemized deduction, still keep track of qualified medical miles.
It often only takes one major medical bill to make all your other excess
medical expenses deductible.
Tip 5:
Plan your business trips to ensure your miles are deductible.
Commuting miles to and from work are not deductible. However, if you stop off
at a supplier first, then the mileage from the supplier to your workplace is a
deductible expense.
Tip 6: Do not forget charitable
miles.
This deduction is one of the most often overlooked deductions. Do you drive for
Meals on Wheels or for a school function? Do you volunteer as a coach for a
non-profit sporting group? These miles add up over time and are often not
properly documented.
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