Don’t panic—this is a pretty common situation. People who work for themselves don’t always get the heads up that their mileage is deductible, so they don’t keep a mileage log for their business.
Even though keeping mileage records throughout the entire year is the best way to document your mileage deduction, the good news is that drivers can deduct mileage based on incomplete records.
According to the IRS, this includes either a “written or oral statement containing specific information about the element,” or “supporting evidence that is sufficient to establish the element.” In plain English, this means that you need to make sure your estimate matches what evidence you do have.
Here's how you can retrace your steps:
- Use your rideshare or delivery trip logs
- Find your total miles driven using maintenance records or other documents from third parties that list your odometer readings.
- Use monthly driving patterns and mean income to calculate your average miles driven for the whole year.
1. Start with your trip logs, if you have them.
If you drive for an on-demand platform, you likely have pretty good records of your business mileage. Uber (and Lyft, and many other on-demand companies) will track your on-trip mileage for you. This includes your mileage when you have a passenger in the car, but not your mileage when you are driving to the passenger, or driving between trips to find places where you’re likely to be matched with a passenger.
Your on-trip mileage serves as the minimum mileage that you can deduct. It’s not a complete record of the business miles that you drove, but it’ll still save you money at tax time.
- On a given day you can see where you began your first trip or ended your last trip, and how far away it is from your home. It’s a tedious process, but if you calculate the mileage between those two points, and can document your exact starting and ending locations, you can calculate your deductible mileage from that information.
- For example, if you go online with your Uber app at home in Oakland, but drive to San Francisco before you get your first passenger, you can calculate how many miles you drove to the city and include those in your deduction.
2. Find your total mileage
When you get an oil change or general maintenance, you'll usually find your mileage listed on the invoice. If you have multiple invoices from throughout the year, use these odometer readings to build out an estimate of your yearly business mileage.
Trace any other documentation from a third party that might list your mileage such as a receipt from a used car purchase.
3. Find your driving patterns and build a yearly estimate based on monthly miles and earnings.
The investigative work described above sounds like a hassle, right? Don’t worry, you can take the typical mileage you drive in a week or month and apply it to a larger period.
- If you find your total deductible mileage for one month and can prove that you drove about the same amount each month, then you can apply your typical monthly mileage to the rest of the year.
- For example, let’s say you were only tracking your Uber mileage for November and December of 2022. If you can show that your Uber income and trip number were the same for all 12 months of the year, and you know that you drove the same number of miles (or within a small range), then you could use your Uber income and trip logs as proof that your deductible mileage was consistent throughout the year.
Important note: Don’t start making stuff up to have a complete log! The goal isn’t to re-create the mileage log that you should have kept in the first place. Unfortunately, it’s too late to have a complete mileage log of your business driving for the year. You’re looking to prove your average with as much evidence as you can.
4. Don't let it happen again!
Take the headache out of finding your mileage next year by starting your tracking now. The Stride app helps you track both your mileage and your deductible expenses (for all of your independent jobs).