By: Justin Ash
As many self-employed individuals know, you can take a deduction on your income tax return for the number of miles you drive for business purposes and are not reimbursed for. There are deductions allowed for miles driven not only for business purposes, but also to obtain medical care, to volunteer your time, and to move to another home in order to accept new employment. The amount that is deductible for 2016 varies as depicted below.
The IRS requires that you be able to substantiate the number of miles driven if asked to do so. The recommended approach is to maintain a mileage log in your vehicle which documents the date and destination of each trip, the starting and ending mileage, and the purpose of the trip.
With the proliferation of smartphones, there are many apps that can track your mileage right on your phone saving you time and headache. Please see below for our comparison of three popular mileage apps available for iPhone and Android operating systems. All of the following have predominantly positive customer review ratings and can be synced to the cloud to safeguard your mileage information even if your phone is lost or stolen.
Mile IQ can log all of your trips automatically and calculate each trip’s value. This means you don’t have to push a start and stop button, you just go about your business and classify the miles later. Additionally, you are able to classify each trip for different purposes. This is useful if you track mileage for both your day job and a side gig, and also if you occasionally volunteer your time. You can also log additional data such as tolls, parking, and hotels paid out of pocket for each trip. As far as getting information out of the app, you can print or export personalized mileage logs and/or expense reports. Lastly, Mile IQ’s website boasts that they never use pop up ads. Mile IQ is free for up to 40 trips each month. After that the fee is $6 monthly or $60 annually. Remember that due to the automatic tracking feature, you will be billed once you exceed 40 trips in one month.
Track My Drive:
Track My Drive offers essentially all of the same options as Mile IQ. The difference is, the user interface isn’t quite as pretty, there is no feature to track out of pocket expenses such as tolls, and the price tag is lower. Additionally, Track My Drive allows you to either track your miles with the GPS as you drive, or to input the beginning and ending address (much like using MapQuest for directions) to calculate the miles driven after the fact. This app also has a convenient feature that allows you to quickly save or delete each trip using one swipe of your finger. Track My Drive is free for up to only 10 trips per month, or $8.99 per year for unlimited trips.
Mile Bug charges a one-time $2.99 flat fee and offers many of the same features discussed above. This app requires that you push a start button to begin tracking mileage for each trip and from there the GPS on your phone will track mileage until you tell it to stop or until you stop driving. Alternatively, you can add trips manually by entering the starting and ending odometer readings. This app also allows you to add expenses like tolls and parking. Customer reviews are a little less glowing for this app, citing that it is a bit more cumbersome to work through. However, for the significant decrease in cost, this app is the best bang for my buck. The lower price tag is well worth the clunkier user interface in my opinion.