It may not be beachfront real estate surrounded by palm trees and tropical breezes, but for most of us real estate investors, our car is our second home.
Indeed, due to the geographic diversification of our portfolios and our relationships, we can sometimes spend more time driving in our cars than connecting with our own families, due to:
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Checking on properties
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Scouting new neighborhoods
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Closings
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Meeting with buyers
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Meeting with sellers
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Meeting with colleagues
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Etc…
And in addition to our time spent focused on the road, we can find ourselves spending even more time trying to track our mileage statistics, in order to claim that much-deserved mileage deduction at tax time.
According to the IRS, real estate professionals (yes, includes investors) may deduct any business expense that is both “normal” and necessary to make a profit. Most of us use the same vehicle for both business and personal use, but the IRS says auto expenses must be divided based on mileage used for business only.
Dim the lights, and hand me the cold compress, because I feel a migraine coming on just thinking about that dusty, dog-eared little business mileage book I try to maintain in the console of my car – those wretched numbers scratched – every once in a while (whenever I can actually remember to do it).
Sure, you can always just “ballpark it”, if your recordkeeping hasn’t been up to par. But try to defend that without some legit records at audit time, and you’ll be crying “uncle!”
Here’s where MileBug swoops-in with a cool new solution to the tedious task of mileage tracking. MileBug’s mileage tracker app uses GPS to log your trip with a map display and takes the “ugh” out of tracking your mileage.
Specifically, this helpful (and cheap) little app allows you to:
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Choose kilometers or miles
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Setup frequent destinations
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Email reports to your home computer
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Even create custom rates!
Boom.
It’s a colorful little app too. Green indicates your starting point, yellow pops up every 1/10 mile, and red appears at the end of your trip. Then BAM! Your mileage is automatically calculated for you.
And it’s available for Apple, Android and even Windows phones.
If you still don’t quite grasp it, here’s a little video we found about it that some guy named “Tucker” made...
[Sidenote for Tucker: Hey Tuck, how about wearing a wireless mic when filming? The sound quality would be much better. Just saying.]
Anyways this is a no-brainer way to invest $2.99 in your business. You’ll probably get, like, a zillion times the return back in tax savings when your mileage is actually tracked and deducted accurately.
Bottom Line
More business mileage accurately documented equals more tax deductions, and using a fancy app to help automate it…well that equals just plain awesome. And who couldn’t use some help tracking, crunching, and storing all those numbers?
This app may not have you doing the happy dance at tax time, but it will probably save your kids from learning a few choice four-letter words this tax season.
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If you’re in business for yourself, then start tracking your business mileage, if you aren’t already. You can do it the hard way (wretch), or do it the easy way, using MileBug on your smartphone.
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Start being generally awesomer.
JP Moses
is a real estate investor in Memphis, TN, with experience ranging from land lording to note buying, rehabbing, and wholesaling. However, wholesaling is the area that he enjoys most and where he bring the most experience and expertise to his students.