I apologize if this was covered previously. I did a search and found quite a bit of helpful information on the subject, but not a direct answer to my question...
I really bumped up the amount of shopping I've done this year, which is a good thing, but I'm realizing that I'm going to have to do a lot more work come tax time now. I'm taking a day or two to get my records in order and make sure I have everything written down so, at the end of the year, I don't have so much calculating to do. (I'm actually really organized, so this shouldn't be too bad). I do have a question about calculating mileage, however.
According to the IRS, I cannot claim mileage to an area where I would normally go for work. This seems like a really gray area, since they do not provide an exact number. Do I calculate any mileage I accumulate, minus the distance to and from the nearest small town? Can I claim mileage once I get to town, if I make multiple stops in the area before coming home? OR... Can I only claim mileage accumulated on long trips??
Any advice (or corrections to my assumptions) would be greatly appreciated.
Also, on a side note, what mileage numbers do you try to hit to keep your tax payment down? Is there a good ratio of miles to dollars to look for?
As a self employed person who works out of their home you should be able to claim all of your mystery shopping mileage. I snap a photo of my odometer when I leave the house and another when I return and deduct any extra miles I might have driven for personal use.
There are reasons that a body stays in motion
At the moment only demons come to mind
The to and from work is for an employee or someone who has an office outside their home and falls under commuting. Under those circumstances mileage for deduction would start at the office and end at the last stop of the day before going home. Our offices and primary workspaces are our homes so all of our mileage is deductible.
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If you have a full-time job, and at the end of the day you do out and do a mystery shopping route, you need to subtract the distance you would have driven from work to home for that day. If you don't on Saturday, your normal "place of work" is you house, and all mileage driven that day for mystery shopping is deductible. If on Sunday, you are driving 100 miles round-trip to visit friends, and add 20 miles doing mystery shops along the way, then you can deduct 20 miles for that day.
Overall, I find that 1/3 of my fees are offset by mileage at $0.575 per mile. I wish that is was lower, but after years (it has ranged from 25% to 41%), I have decided that 1/3 is typical for me in my area with the type of shops which I do.
Shopping Southeast Pennsylvania, Delaware above the canal, and southwestern NJ since 2008