You can now track your mileage, categorize business trips, and view your tax deduction—all from your phone, using Mileage Tracking.
If you drive a car for work, you can maximize your tax deductions by claiming the mileage.
But keeping track of your travel on the go can be a huge hassle. Between logbooks, gas station receipts, and remembering which trips are actually work-related, it’s easy to lose track of what you can and can’t claim on your taxes.
To help, FreshBooks created the new Mileage Tracking feature. Now, you can automatically track your mileage as you drive, easily categorize trips as business-related, and see your potential tax deductions—all from the FreshBooks mobile app.
What Is Mileage Tracking?
Mileage Tracking is a new feature on the FreshBooks mobile app that lets you track your mileage, categorize each trip, and view your potential tax deductions.
Where Is the Mileage Tracking Feature?
How Do I Track My Mileage?
The Mileage Tracking feature works the same as any other mileage tracker app. To get started, just open the app and you’ll be prompted to complete a quick setup. Once complete, the app will recognize when you’re driving for automatic mileage tracking. It’s simple and hands-off, so you can focus on the road. Here’s what the setup screen looks like:
How Do I Categorize My Trips?
You’ll be periodically asked to review any trips the app has tracked for you (which makes expense tracking easier). Simply swipe left to categorize a trip as Personal or right to categorize it as Business. That way you will have a tax compliant mileage log of all your trips – keeping business miles separate from personal drives. Here’s what the review screen looks like:
Can I Manually Add a Trip?
Absolutely. Manually add a trip anytime using the below steps:
- Tap on the More… button at the bottom right
- Then tap on Mileage Tracking
- Tap on the + Add Trip button in the middle or the + button in the top right corner
- For the Category, choose Business or Personal
- The Start Date and time will default to today, tap to change to a different date and time
- Tap on Start Location and choose your starting point
- Next, tap on End Location and choose your destination
- The Distance will automatically be calculated, tap to adjust the distance if your route was longer or shorter
- Tap on Save to finish and your trip will be logged in the All tab.
What Mileage Can I Claim for My Business?
Simply put, if it’s for work, it’s deductible. Making a sales call, driving to a client presentation, even visiting the post office to send a shipment to a customer can count toward your tax deduction.
Just remember that the trip has to be for work. So, you can track the 20 minutes to and from a sales call. But if you stop for a slice of pizza on the way back, that extra mileage doesn’t count.
How Do I See My Tax Deduction?
Once you categorize a trip in-app, it’s sent to your Reviewed tab. At the top of this page, you’ll see a section that shows your total distance tracked, as well as your Potential Deduction. Here’s an example:
What Else Can I Do With the Automatic Mileage Tracker?
You can easily generate a Mileage Log Report and email it directly from the app by clicking on the paper plane icon in the top right corner of the Mileage Tracking page. This report is also in your FreshBooks account under the Reports section, and shows you all potential deductible mileage at tax time.
Will I Ever Need a Separate Mileage Tracking App?
No! The beauty of using the FreshBooks mileage tracker is that it is an extension of the rest of your account. So all your expense tracking related to driving is reflected in all the reports you would run with your desktop FreshBooks account.
So once you have it set up you can easily track business miles just by driving – without the need for a 3rd party mileage tracking app (like the MileIQ business mileage tracker) or paper mileage log. Just set it, and forget it – until you want to review your trips to categorize as business mileage or personal mileage.
Things to Keep in Mind
It’s important to remember that the Mileage Tracking feature can only show you a potential tax deduction. It’s the best estimate the app can provide based on your mileage tracked, but may not be 100% in line with what the government will actually reimburse you. But… having a record of your trips makes filing your taxes automatically a little bit easier!
If You Need Help, FreshBooks Is Here
If you have any questions on how to use the mileage tracker or have feedback on how it can be improved, feel free to reach out here.