Tracking Your Transportation Expenses
As a tutor, you’ll find yourself driving all over town to meet with your students, replenish your supplies, and to distribute and post your advertising materials. Guess what? You can typically deduct the mileage on your personal vehicle on your taxes when you use it for business purposes. The same goes for parking fees, taxi fare, and bus fare!
It’s essential to keep good records in order to make the most of those deductions. Your tax professional will need these records to maximize your deductions. Documents you need to save are all receipts for your vehicle-related expenses: repairs, oil changes, gas, insurance, etc. Additionally, you need to record the mileage you put on your car when you’re driving on business-related errands such as meeting with clients, driving to buy office supplies for tutoring, mailing out marketing materials at the post office, and so on. An easy way to do this is to track it in your planner where you record your appointments. When you’re leaving to meet with Timmy at the library, write down the mileage of your car before you leave and then (assuming you come straight home afterwards) record the mileage when you get home too. The difference (mileage when arriving home minus mileage before leaving) is the mileage that you put in for that session, and it is deductible in most cases!
I saved a nice chunk of cash on my taxes by tracking my transportation expenses and so can you! Once you get into the habit of recording your mileage when on business it becomes something you do mindlessly. Don’t give up if you forget a few times, it happens to everyone!
As with any tax advice, make sure you consult your tax advisor before making these deductions on your taxes. There are all kinds of ambiguities in tax laws so make sure you know for sure that you’re following the rules before filing your taxes.