Legal Definitions - Mileage Log

A Mileage Log is a systematic record kept by an individual or a business detailing the distances traveled for specific purposes, most commonly for business-related activities. This log typically includes crucial information such as the date of the trip, the starting and ending odometer readings, the total miles driven, the destination, and a clear description of the business purpose for the journey.

The primary reason for maintaining a precise mileage log is for tax compliance and to substantiate claims for business expense deductions. Tax authorities, such as the Internal Revenue Service (IRS) in the United States, require accurate documentation to verify that claimed vehicle expenses are legitimate business costs. Without a clear and comprehensive record, individuals and companies risk losing valuable tax savings or facing challenges during an audit, where they would need to prove the validity of their reported mileage expenses.

• Example 1: A Self-Employed Consultant

  Maria, a self-employed marketing consultant, uses her personal car to drive to client meetings, attend industry conferences, and visit print shops for project materials. To accurately account for her business expenses, she diligently maintains a mileage log. For every business trip, she records the date, her car's odometer reading at the start and end of the journey, the total miles driven, and the specific business reason (e.g., "Meeting with Apex Solutions," "Attending Digital Marketing Summit," "Picking up brochures for client presentation"). At the end of the year, Maria uses this detailed log to calculate her total business mileage, which allows her to claim a significant deduction for vehicle-related expenses on her personal income tax return, thereby reducing her overall taxable income.

• Example 2: A Commercial Pest Control Company

  "Bug-Be-Gone," a commercial pest control company, operates a fleet of service trucks that technicians use daily to visit customer properties. The company mandates that each technician complete a mileage log for every shift. This log tracks the miles driven for each service call, including trips to the company warehouse to restock supplies. By compiling these logs from all vehicles, Bug-Be-Gone can accurately determine the total business mileage for its entire fleet. This comprehensive record enables the company to deduct substantial expenses like fuel, vehicle maintenance, and depreciation on its corporate tax return, ensuring it complies with tax regulations and maximizes its eligible business deductions.

• Example 3: An Employee Seeking Reimbursement

  David works as a regional sales manager and occasionally uses his personal car to visit clients located in different cities within his territory. His employer has a policy to reimburse employees for business mileage at a standard rate. To receive this reimbursement, David must submit a detailed mileage log. For instance, he records a trip on October 15th to "Innovatech Corp." in a neighboring city, noting the starting and ending odometer readings and the total miles. This log serves as official documentation for his employer to verify the business nature of the travel and process his reimbursement, while also providing the company with the necessary records to justify these expense reimbursements for their own tax reporting.