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QuickBooks 2013 For Dummies by Stephen L. Nelson, MBA, CPA

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Tracking Vehicle Mileage

QuickBooks includes a vehicle mileage-tracking feature that lets you track your business miles. To track vehicle mileage in QuickBooks, choose Company⇒Enter Vehicle Mileage. Then, in the Enter Vehicle Mileage dialog box that appears, record the vehicle, date, miles driven, odometer settings, and reason for the trip. (I talk a bit more about tracking vehicle mileage in Chapter 18, so check that out if this is something you’re really interested in.)

May I briefly tell you the IRS rules for deducting business miles? Essentially, you have two approaches to choose between. The easier method — and the one that I use, because I’m lazy — is to record as a business expense an amount per business mile driven. The rate per mile is roughly $0.55, which is far less than the actual cost of driving most cars. But, hey — that’s the price of slothfulness.

The hard method for tracking business miles is to track all your vehicle expenses — including gas, oil, repairs, insurance, and vehicle depreciation — and then record as a business expense the business-use portion of these expenses.

To get the business-use portion of your vehicle, use the ratio of business miles to total miles. For example, if during the year, you drive 6,000 business miles and your total miles are 12,000, your business-use percentage equals 50 percent. In this case, you can record as a business expense 50 percent of your vehicle expenses.

Usually with the hard “actual expenses” method, you get a higher ...

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