Tired of High Gas Prices? Lower Them!

In Michigan recently, the average price for a gallon of gasoline was $4.26. In some states, it’s even higher.

As a writer, you can reduce this. For the first half of 2011, under the Internal Revenue Code, you may deduct 51 cents for every business mile you drive. In July, the rate was raised to 55.5 cents per mile.

What does it amount to?
If your vehicle gets 35 miles per gallon, you will receive a tax deduction of $17.85 ($19.43 starting in July) for each gallon you burn for business purposes. Not only does this wipe out your business gasoline costs, but the excess amount also pays for your oil changes and repairs, indirectly, by lowering the federal income tax due on your 2011 tax return.

How do you do it?
The IRS requires you maintain a “contemporaneous record” of the business miles and the business reason for the mileage. Among trips that qualify:

  • Going to the library for research
  • Driving to conduct interviews
  • Attending a writing seminar or workshop
  • Meeting with your editor

Record the business miles you drive as well as the purpose of the trip. You can also deduct business-related parking fees, tolls, meals, and lodging.

So, write it down—then write it off!

Gary A. Hensley has worked at local and national CPA firms, Ford Motor Company as a tax consultant, and as an auditor for the Michigan Department of Treasury. He also operated his own firm providing accounting, consulting, and tax services. His articles have appeared in local and national publications.

Comments

  1. says

    I love this idea. Gas prices do irritate me, when most things outside my control do not.
    I don’t like being at the mercy of greedy oil producers, who are wreaking havoc on our economy. My only defense so far has been using my feet, which helps not only my economy but my metabolism as well! Thanks for another idea!

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