January 6, 2021
The Internal Revenue Service (IRS) has announced the 2021 Business Mileage Standard Rate of 56 cents, down 1.5 cents from the rate for 2020. This applies to miles driven starting January 1, 2021.
For Medical purposes, the Standard Mileage rate is 16 cents per mile driven. The same applies to Moving purposes for qualified active-duty members of the Armed Forces. This is down 1 cent from the rate for 2020. In cases of trips concerning Charitable Organizations, the rate is 14 cents per mile driven, unchanged from 2020.
The new rates decreased because of changes in Fuel Prices, Fuel Economy, and Insurance Costs.
How does this affect You?
Any mileage you put on a personal vehicle for Business purposes is eligible for Mileage Deduction.
If you use the Standard Mileage Deduction, which is based on the just-announced standard mileage rate, you will need to keep track of all your Business Trips, the Reason for the trip, Dates, and Mileage.
If you choose to use the Actual Expense Method, where you need to keep track of all your actual expenses including gasoline purchases, oil and maintenance expenses, interest expenses on the vehicle loan or, lease payments for the tax year, annual depreciation of the vehicle, registration fees, insurance, repairs, tolls, tires, garage rent, parking fees.
To be able to determine which method is most beneficial for you, consider seeking the help of a qualified CPA or Accountant.
Don’t Leave Money on the Table
Would a good few $1,000s in tax returns come in handy during these crazy times? That is the average amount you can deduct / month by keeping a mileage log. You need supporting IRS-Proof Mileage Logs whether you choose to use the Standard Mileage Rate or the Actual Expense Method to claim a Vehicle Deduction.
With the MileageWise Mileage Tracker App, you can easily track your trips and refuelings on the go. With the AI Wizard feature, we have developed a technology that makes an IRS-proof Mileage log recommendation for you by taking into account all the legal regulations about mileage logging and tax return policies. Using this technology we can make you a Recommended, Personalized Mileage Log, which will correspond to the exact mileage you have driven according to your odometer, even Retrospectively.
In the process the Built-In IRS Auditor checks and corrects 70 logical conflicts with a Smart Algorithm, so your Mileage log will be IRS-proof without a doubt, meeting Every Expectation.
If you are still worried that you can’t keep track of your mileage, Outsource It to our Experts. They will be more than happy to help!
