Hello all,

I have a question that I cannot seem to find a direct answer to.

I'm self-employed, and this past year I was reimbursed by a client on actual gas receipts-- so, for example, $30 was reimbursed on what I paid for gas, yet I drove say, 100 miles.

Question: Do I treat the $30 as income and deduct the actual mileage on the standard mileage rate @ 56.5/c a mile or do I split the difference between the $30 reimbursed and the 100 miles driven @ 56.5/mile?

Thank you!

To claim a tax deduction for business mileage, self-employed contractors must understand the rules.what you are talking about here is the standard mileage rate, provides you with a per-mile tax deduction. Some states also allow you to deduct business mileage when reporting state income tax, but state mileage rates do not always follow federal rates. Some states use the federal rate while others set their own rates.also
You have the option of deducting actual expenses. This option provides benefits if you spent more on traveling than the federal reimbursement rate provides. Actual vehicle expenses include the actual cost for fuel, maintenance costs, oil change costs, the cost of new tires, vehicle registration fees, vehicle loan interest, vehicle insurance, lease payments, vehicle depreciation and toll booth and parking fees. Vehicle loan interest, toll and parking fees and registration fees also can be deducted by those who opt for the standard mileage rate. When you use the actual expenses option, you also must calculate the percentage of business use of the vehicle. The vehicle is used 100 percent for business if you do not use it for personal reasons. Otherwise, you have to subtract a percentage of the expenses due to your personal use of the vehicle.so i f you choose the standard mileage rate, you may not deduct your gas receipts(also It Is not reportable income to you) reimbursed by your ER UNLESS he reports it on your 1099, but you may deduct business-related parking charges and tolls.


Note;

To be reimbursed for expenses incurred on behalf of a client, you provide an invoice with adequate accounting for expenses to the client. Generally adequate accounting includes a detailed list of receipts if requested by the client. Assuming the client reimburses valid business expenses, you will not report the reimbursement as income, nor will you deduct the expenses as business expenses. The reimbursement will not be reflected on your Form 1099-MISC.if you neglect to provide a detailed list of business expenses to the client, the reimbursement, if it is paid, is included as income to YOU on Form 1099-MISC. Assuming you maintained sufficient records of the expenses, you may deduct the expenses on Sch C of Form 1040