Home Page link  

Standard Mileage Rate May Actually be Better

  
Groups | Search | About
User Password
Register Now! Lost Password?

General Accounting - General Accounting Discussions

 Post an article  get this group's latest topics as an RSS feed add this group's latest topics to your My MSN content add this group's latest topics to your My Yahoo content  add this group's latest topics to your Google content  YahooMyWeb Yahoo!  Google Google  Windows Live Favorites Windows Live  del.icio.us del.icio.us  digg digg  Add to Netscape Netscape
Subject Author Date
Standard Mileage Rate May Actually be Better Tax Tip 07-16-2008
Posted by Tax Tip on July 16, 2008, 9:53 am
Please log in for more thread options
 You can deduct vehicle costs on your taxes using actual vehicle
expenses or the standard mileage rate.

Actual Expenses: Collect Receipts and Write-Off Expenses that are
Deductible
Standard Rate: Log Mileage and Deduct using Standard Mileage rate

The STANDARD RATE may be more beneficial for individuals who have a
lot of mileage and low vehicle costs. Using the ACTUAL EXPENSE method
is only better when your vehicle costs are very high.

The standard mileage rate is used to figure the deductible cost of a
vehicle that is owned or leased. For Tax Year 2008, the IRS is
allowing taxpayers to deduct 50.5 cents per mile driven for the first
6 months of 2008, and 58.5 cents per mile driven for the final six
months.

FOR EXAMPLE
A person who spent $10,000 on gas but only traveled 10,000 business
miles would want to use the Actual Expense Method because it can yield
a larger deduction than the Standard Mileage Rate.

Actual Expense Method - $10K deduction for gas expense
Standard Mileage Rate - $5.85K standard deduction (10K * 58.5 Cents)

Use the Method that is most Advantageous!!!
A person who spent $5,000 on gas and traveled 20,000 business miles
might benefit more from the standard mileage deduction.
Actual Expense Method - $5K deduction for gas expense
Standard Mileage Rate - $11.7K standard deduction (20K * 58.5 Cents)

Pay attention to specific rules about listed property, depreciation
limits (which change often), and switching accounting methods. Whether
using the standard mileage or actual expense deduction, be sure to
track mileage and expenses related to your rental activity. You
usually won't know which method to use until the end of the tax year,
so it's best to just keep a good record of all vehicle activities.

To learn how to take control of your Real Estate and Taxes, check out
RealTaxTips at TReXGlobal.com ( http://www.trexglobal.com).


Community Relations TReXGlobal.com
( http://www.trexglobal.com )
Simple FREE to Use Web Tools for Real Estate Investors

Posted by Rocinante on July 16, 2008, 5:44 pm
Please log in for more thread options
> > FOR EXAMPLE
> A person who spent $10,000 on gas but only traveled 10,000 business
> miles would want to use the Actual Expense Method because it can yield
> a larger deduction than the Standard Mileage Rate.
>
> Actual Expense Method - $10K deduction for gas expense
> Standard Mileage Rate - $5.85K standard deduction (10K * 58.5 Cents)
>
I guess commercial truck drivers could spend $1 of gas per 1 mile
travelled (around 5 MPG). Otherwise, the standard rate is always the
best expense method to choose.


Posted by Sanforized on July 16, 2008, 6:58 pm
Please log in for more thread options
Rocinante wrote:
>
>>>FOR EXAMPLE
>>
>>A person who spent $10,000 on gas but only traveled 10,000 business
>>miles would want to use the Actual Expense Method because it can yield
>>a larger deduction than the Standard Mileage Rate.
>>
>>Actual Expense Method - $10K deduction for gas expense
>>Standard Mileage Rate - $5.85K standard deduction (10K * 58.5 Cents)
>>
>
> I guess commercial truck drivers could spend $1 of gas per 1 mile
> travelled (around 5 MPG). Otherwise, the standard rate is always the
> best expense method to choose.
>

There are expenses other than fuel. Sometimes they're significant.

Similar ThreadsPosted
Auto Standard Mileage Deduction July 26, 2007, 12:53 am
How to handle Standard Mileage for Schedule C March 27, 2008, 11:48 pm
Use your PocketPC as mileage log January 31, 2007, 9:13 pm
Mileage Reimbursement Accounting July 1, 2007, 7:42 pm

Contact Us | Privacy Policy
This site is not affiliated with Intuit - makers of Quickbooks and Quicken software
This site is not affiliated with Sage Software - makers of Peachtree accounting software
XML SitemapXML Sitemap