Mileage log

[ILLMAS]

What do you do when a mileage log doesn't exist?  My associate will be leaving a vacation and asked me if I could work with his client that received an IRS letter requesting support for employee unreimbursed  expenses (all mileage in this case), I gut feeling is that the client doesn't have one.

 

[Lee B]

Over 15 years ago I assisted a commission salesman who was audited, I didn't prepare the return.

His employer did not reimburse expenses and the taxpayer did not keep a mileage log.

Fortunately the salesman had a stable client base, that he called on every month.

I had him reconstruct a mileage log based on his client list, plus he got a letter from the Safeway Bakery manager

where he picked up donuts every morning to give to clients which added up to well over $ 1,000 .

The reconstruction salvaged about 60 % of his claimed mileage and the auditor gave him the donut deduction.

As I remember he still ended up owing over $ 4,000 mostly due to undocumented mileage plus some other undocumented expenses.

Obviously the auditor could have really hammered him.

[Abby Normal]

A friend of mine keeps old calendars for prior years and when he was audited. He used a bunch of different pens to recreate his mileage log on a calendar. IRS accepted without question.

[Cathy]

4 hours ago, ILLMAS said:

What do you do when a mileage log doesn't exist?  My associate will be leaving a vacation and asked me if I could work with his client that received an IRS letter requesting support for employee unreimbursed  expenses (all mileage in this case), I gut feeling is that the client doesn't have one.

I'm sure we have all given each of our clients the mileage log requirements more than once to say the least.   One of my clients went to an audit without me as I had warned my clients that no mileage log and you go on your own!  The auditor was so impressed with how well prepared the client was pertaining to all other aspects of the return (it was a full line by line audit...I told her how to get organized and what she needed to do...didn't do her job for her...just guided her).....getting back to the auditor, she told my client to go back home that evening and "reconstruct a mileage log" and even gave her several tips on how to stretch the mileage to make it work out to the total miles she claimed.  To make a long story short, it was a "nothing owed" audit.  

Illmas, to make a long story short, I would sit down with the client (maximum 15 minutes) and tell him what IRS expects to see on the mileage log.  I might even go so far as to print out blank forms for him to use.  It's not your fault neither your responsibility to do what should have been done before his return was prepared.  And don't let him/her please dumb and helpless....I'd then wish him well and tell him I hope he gets through before the July 4th holiday.  And....sure....after HE gets completely through with his log.....totals, etc...., COMPLETELY THROUGH, I'll be glad to look it over before your audit.  With an "associate" like yours, who needs enemies??

Take care,

Cathy

 

 

 

[FDNY]

This has always been one of my pet peeves.  Year after year I get estimates (like 12,000 miles)  that I usually need to adjust and reduce greatly after I document a conversation and email statement from client describing their job and  travel particulars.  I will only take a deduction if they could not do their job without travel.   I've always explained the requirements and have told them to pick up a $6 mileage log booklet from Staples and keep it in the glove compartment.  I've even bought a few for some clients but it is never filled out.   I drive 7 miles round trip to the post office 260 days a year and write it in each day, takes 10 seconds, so I tell them, get disciplined, it's money.