What If I Didn't Track My Miles?

Missed tracking your miles for tax purposes? Don't worry, it's not too late to claim your deduction. In this guide, we'll show you how to reconstruct your mileage log and ensure you get the tax benefits you deserve. Learn how to use various data sources to support your claims and discover the advantages of using a mileage tracker app like Everlance for future tax seasons

Summarized Important Points:

• Mileage tracking is crucial for tax deductions.
• You can reconstruct your mileage log using app history, emails, calendar events, and GPS data.
• Accurate mileage tracking ensures you maximize your tax benefits.
• Using a mileage tracking app like Everlance simplifies the process and ensures IRS compliance.

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Now let's dive in!

Tax deductions for untracked miles

Tracking miles for tax deductions is essential for anyone using their vehicle for business, charitable, medical, or moving purposes. The IRS requires detailed records to support your deductions, including dates, miles driven, and purpose of each trip. Without this tracking, you risk losing out on significant tax savings. However, many individuals find themselves at the end of the year without accurate logs. This situation poses a challenge but can be addressed by reconstructing your mileage log using alternative documentation and digital tools.

The requirement for detailed records applies for both:

• Standard mileage method: where you apply the IRS mileage rate for business-related driving to your work miles
• Actual expense method: where you deduct a portion of your actual car expenses based on your business use percentage

Here’s the good news. The IRS allows people to put together their mileage numbers based on incomplete records.

You need to have:

• A statement explaining how you came up with the number of miles you drove for work purposes. You need to explain the evidence you use and how you calculated the number of miles based on the evidence.
• The evidence to back up your statement.

Could you make up some numbers or guess? No, not really.

There is a law that allows taxpayers to estimate deductible amounts of some unsubstantiated expenses. But that doesn’t apply to auto expenses. So you need to support your mileage claim with evidence.

Making up numbers is a terrible idea. Auditors are good at spotting imaginary numbers; if they suspect anything, they’ll disallow your deduction. You won’t be able to claim any miles or car expenses if you try that. What’s more, lying on your tax returns will get you fined. Instead of saving money, you’ll end up losing money.

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How to build your mileage log for tax deductions

The IRS requires timely kept records to help justify the number of miles you drove for work. That means when you’re putting together your work miles, you should use evidence that is from around the time the miles were driven.

1. Identify the dates you worked

First, find out which days you were doing gig work.

• Check the trips or earnings history in the app. For example, DoorDash lets you see all your completed orders in the Earnings tab.
• Check your email for records. Most delivery services email you regarding completed deliveries and weekly payouts and summaries. These can help you find which days you were working.

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2. Look for documentation of miles you drove on days you worked

The ideal scenario is to use sampling. If you tracked miles on some of the days you drive for work but not all, you may be able to use this method to determine your total work miles for the year by extrapolating from your sample.

Sampling
You can keep an adequate record for parts of a tax year and use that record to prove the amount of business or investment use for the entire year. You must demonstrate by other evidence that the periods for which an adequate record is kept are representative of the use throughout the tax year.
- IRS Publication 463 (2022), Travel, Gift, and Car Expenses

"Adequate records," in the eyes of the tax authorities, are 3 months (90 days) or one week of each month. The three-month period could be any three months of the year. The week-a-month period needs to be the same week of each month. You also need to make sure your sampling period is as representative as possible of how much you drove for work the rest of the year.

However, if you don’t have a sufficient sample, you still have options to determine the miles you drove for work. Once you know which days you made money with each platform, you have a starting point for figuring it out. You can look at:

• In-app trip details: For example, both DoorDash and UberEats delivery receipts have an estimated distance. Keep in mind they do not include the miles you clocked between deliveries or the times you take an alternative route, so simply adding those numbers won’t give you all the miles you drove for work. But it’s a good start and if nothing else, you can confidently claim at least these miles.

• Emails from the app: Similar to in-app receipts, a lot of miles won’t be accounted for, but they also serve as evidence for business driving.

• Point-to-point mileage estimates: Google Maps can show your location history via their Timeline feature. The feature needs to be enabled, but you don’t need to have used Google Maps for navigation. Once you know the days you worked, you can check Google Maps for driving patterns that match your deliveries. Apple Maps will only record history if you used it for navigation.

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3. Create a mileage log

An IRS-compliant mileage log should include for every work trip:

• A record of your mileage
• The date
• Location and purpose

Creating this mileage log serves as a statement explaining how you came up with the number of miles you drove for work purposes.

You should also save the documents you used for information in case you get asked to produce them. Save them all - the emails, the screenshots and documents exported from apps - into one folder. These are the evidence to backup your statement and if the IRS comes calling, you’ll probably need to provide them.

Finally, prepare a written statement on how you got your numbers.

Related: IRS Mileage Log Requirements | Everlance

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4. Max out your other deductions

To save as much as possible on your taxes, make sure you're claiming as many other work-related expenses as possible. Mileage is not the only thing you can write off. Paying more attention to other write-offs can help you reduce your taxes.

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Where can I get my mileage total if I didn't track it?

In addition to the number of miles you drove for work, you also need to report the total number of miles you drove for the year. When you fill out your Schedule C tax form, it asks for your business-related miles, commute miles and personal miles. So you need your total annual mileage.

If you're driving for work, it's a best practice to jot down your odometer reading at the start of the year and again at the end of the year. The difference is your mileage total.

If you didn't, there are other places to look to figure out your total mileage number.

• Check your car maintenance records from around the beginning and end of the year.
  Many garages record the odometer reading when they perform maintenance or repair services. You can often find the readings on the receipt.
• Get your driving history from your GPS if available.
  Most GPS apps keep some form of history, and many of the in-car GPS programs do as well. Keep in mind that the GPS on your phone might not be reliable though. Some GPS apps only record when you’re using their navigation system. The ones that record everything have no way to determine which car you’re driving, or if you're a passenger in someone else's car.

The IRS uses these mileage numbers to check if a reasonable percentage of your driving was for business purposes. Remember this point throughout the process of putting together your mileage records and evidence. At the end, you can (and should) also do your own check that your percentage of business use seems reasonable. Just divide your work miles by your total miles.

If you're using the actual expenses method, this formula is how you determine your business use percentage. You'll then multiply that number by your total car expenses to calculate how much you can claim on your taxes.

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Maximizing your tax deductions with mileage tracking

Reverse-engineering your mileage is tough. There is a chance your claim won’t stand and you might be asked to produce evidence to back it up.

What’s more, trying to create a mileage log at the last moment just adds to the stress of the tax season. You’re much more likely to make mistakes and miss out on deductions.

Tracking your mileage properly is the best way to avoid the hassles. It:

• Removes the guesswork and stress of retroactive calculations
• Keeps you organized for tax season
• Provides peace of mind you're maximizing your deductions

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How to track your mileage for deductions

You should start using a mileage tracker for taxes to avoid missing out on tax deductions.

The IRS accepts any log format as long as records are adequate. Pieces of paper, handwritten logs, digital spreadsheets and other digital document formats all count. So you can track your mileage manually or automate the process.

However, tracking your mileage manually puts you back to square one. You’re already busy with your gig and everything else going on in your life. Why create work for yourself?

• Handwritten logs: You have to develop the habit of writing down your miles without fail. You’ll need to jot down odometer readings every time you drive for work.
  Also, remember to check the odometer on the January 1 and December 31st of each year to calculate your total mileage. And make sure you don’t misplace the book or spill anything on it!
  

• Google sheets (an online log): You don’t have to carry it around like a physical logbook and you can tweak the sheet to tally up the numbers for you.
  But you still need to remember to record your miles, and there is a good chance you’ll forget it at some point (for no fault of your own).

• Mileage tracking apps: The easiest and smartest way. These apps can track your mileage for you, running in the background on your smartphone. Just export the records when tax time comes and you’re good to go. Some can even find tax deductions and track business expenses for you.

Related: Free IRS Compliant Mileage Log Template | Everlance

What is the best way to track mileage for deductions?

The best way to track your mileage is to use a mileage tracking app. It

• Increases the accuracy of your records
• Makes sure your log is IRS-compliant
• Saves you time from having to maintain a manual log
• Removes the stress of not having mileage records (and the stress of keeping records)
• Gets you the biggest tax deduction possible

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But all mileage trackers are not created equal. Some still require manual input from you. Some are unreliable and clunky. Some of them are hard to navigate or plain too expensive, and being a gig worker is taxing (no pun intended). The last thing you want is to be saddled with a mileage tracker that takes time away from your actual work or gives you a faulty log.