Snuffy, you are entitled to claim all your mileage and other expenses against your gross income from mystery shopping, but there may be some reasons you wouldn't want to do that. You can research any tax question at IRS.gov. I'm not qualified to give you tax advice but I would like to make some comments that may be helpful.
If you show a loss several years in a row, the IRS may decide that your mystery shopping business is a hobby and if they do that, they will disallow all expenses and you will be liable for income tax on the total gross income. I have never heard of this actually happening to anyone, but under IRS rules they can do this. It's possible. And - they might also be able to go back and collect previous years. If you don't make enough from all your employment and business ventures to owe income tax even if you lost the right to deduct the expenses, this would not matter to you.
If you are offsetting other income by a loss from your mystery shopping business, this gets stickier. Any large side business loss that offsets W2 income is a red flag. You can avoid offsetting W2 income by not reporting all your expenses so that you reduce your loss to a small number.
Another issue is that if you are reporting mystery shopping income totals, either positive or negative, that affect the earned income credit by increasing the amount of the refundable credit that will also raise a red flag. If your age or income levels make you not eligible for the earned income credit, then this is not an issue for you.
Mary Davis Nowell. Based close to Fort Worth. Shopping Interstate 20 east and west, Interstate 35 north and south.