Self-employment has been the beginning of many great entrepreneurs, who built their fortunes starting from nothing. For dedicated self-made business owners, there is only one obstacle they need to overcome to achieve success – taxes.
Fortunately, there are ways to write off business expenses and benefit from self-employment tax deductions, with the mileage tax often being the most common to deduct. How is it all done?
How can self-employed entrepreneurs save on taxes?
To benefit from a write-off, you’ll need to actually apply for it. There are numerous available deductions for independent contractors, including home office deductions or health insurance – but what expenses are tax-deductible?
Mileage and car expenses are among the most common tax deductions for self-employed business owners. Entrepreneurs can write off a car for business purposes or deduct the purchase of a vehicle, but they can also get returns on driven mileage – as long as they keep proper track of it, usually with an app for self-employed mileage deduction.
Mileage tax deduction guide for self-employed
At the beginning and end of each year, self-employed business owners will have to record their mileage. All the trips using company or own vehicles must be recorded as either business or personal trips. The logs must be kept neatly and need to be consistent – the IRS, in case of an audit, can withhold your tax deductions if they find any errors in the logs.
There are many ways to accurately track your mileage. Lately, many self-employed entrepreneurs switched to digital methods of tracking, including using a mileage log book application like Mileage Wise.
Use a mileage tracker app to track your miles accurately
Instead of stressing over every detail, you can use a mileage tracker app to keep an accurate mileage log for you. With just a simple app on your phone, you can track and store driven miles, generating an IRS-compliant mileage log when needed.
Mileage Wise is an advanced tool for business-owners, allowing self-employed people to save over $12,000 per year per car on average. With a powerful AI-driven algorithm, Mileage Wise can also recreate lost miles based on previous destinations. It even has a free trial period with unlimited trips for 14 days!
There is no reason not to give it a try – you can download Mileage Wise on the App Store on any compatible device.
Also read: 7 Benefits of Running an Online Business