Should I track miles for taxes?

If you drive a car for your 1099 contractor work, you can claim a big tax write off on associated expenses. There are two ways: keeping track of car expense, or tracking mileage. 

Tracking Your Miles For Write Offs

The mileage method was introduced by the IRS to simplify the process of trying to keep track of all of your gas / car maintenance / receipts year-round. But does claiming mileage actually save you more money on taxes?

Option 1: Car expense records

At the end of the year, sum up all of your car expenses such as gas, insurance, repairs,️ oil, registration etc, and write off the approximate proportion of the time you drove your car for work.

Option 2: Mileage tracking

Throughout the year, record miles driven for work with a logbook, app or mileage keeper. At tax time: claim 54.5 ¢ (the exact amount changes every year) in tax write offs for every mile you’ve recorded.

So... which option saves more money?

There’s no one right answer for everyone, but there's a right answer for you! Let’s start by outlining two examples with different of driving behavior and some assumptions about the kind of car you drive and gas prices.

Example 1: Typical drivers... save more with car expenses.

Let’s say you drive about 10,000 miles per year, half of that for work. On an average week, that’s about 200 miles, or 5-10 hours of driving. Assuming average stats about car repairs needs, mpg vehicle efficiency, and gas prices, it turns out the actual car expense method is a lot better!

typical driver mileage method
typical driver, expense method

That’s a pretty big difference! With the actual expense method, you’ll be claiming an additional $655 in tax write offs which is about $200 saved at tax time (assuming 30% effective tax rate).

Example 2: Heavy drivers... save more with miles.

Let’s say you drive a lot for work. Maybe you are doing taxes for Uber or delivery and you rack up 20,000 miles per year, 75% for work. Here's how your taxes would break down:

heavy driver, mileage method

heavey driver, expense method

Bottom line: if you drive a lot, it's a good idea to track your miles. Otherwise, don't bother. Either way, use our business expense tracker.

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Justin W. Jones, EA

Justin W. Jones, EA


Justin is an IRS Enrolled Agent, allowing him to represent taxpayers before the IRS. He loves helping freelancers and small business owners save on taxes. He is also an attorney and works part-time with the Keeper Tax team.

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Skip Scooter Taxes
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Note: at Keeper Tax, we're on a mission to help freelancers overcome the complexity of their taxes. That sometimes leads us to generalize tax advice. Please reach out via email if you have questions.