Mileage Tax DeductionInstead of taking the actual cost tax deduction for your vehicle you may elect to take the standard IRS mileage tax deduction. In my opinion this is the easier of the two approaches. All you have to do to track your vehicular tax deduction using the IRS standard mileage allowance is keep a log of your business miles. At the end of the year you take the sum of your business miles and multiply it by the IRS standard mileage deduction rate for that year and then simply report that on your tax return for your tax deduction. In 2005 the IRS increased the amount of money that you can deduct per mile from 37 cents to 40.5 cents. A few notes… If you choose to use the standard mileage tax deduction you can still deduct your parking tolls and fees. You can use the standard mileage deduction rate even if you lease a car. If you are involved in a home business that requires a great deal of travel then leasing a car and taking the standard mileage allowance would be most business savvy choice to make. Why? The standard mileage deduction takes a car's yearly depreciation dollar amount into account. Normally, you can ONLY deduct depreciation if you own your car, but if you use the standard mileage tax deduction you can get around having to own a car to take advantage of depreciation deductions. Can't Find what your looking for? Now you can search Perfect Home Based Business Opportunities with the simple click of a button! Just enter what you're searching for then hit search and viola! Ain't technology great... |