Do I need to track mileage for rental property visits?
The short answer is yes, if you want to deduct it. Mileage for rental property visits is a legitimate business expense, but the IRS requires documentation. No records means no deduction.
Driving to your rental property counts as a deductible expense when you’re going for business purposes. This includes trips to collect rent, perform maintenance, meet with contractors, show the property to prospective tenants, handle move-in or move-out inspections, or respond to tenant issues. All of these qualify as ordinary and necessary expenses of operating a rental property.
What doesn’t qualify is mileage related to purchasing or selling the property. Those trips get added to your cost basis or deducted from the sale, not claimed as ongoing rental expenses.
The standard mileage rate is currently 67 cents per mile for 2024. That might not sound like much until you do the math. A 15-mile round trip twice a month adds up to 360 miles per year, worth about $241 in deductions for just one property. Real estate investors with multiple rentals spread across Northern New Mexico can rack up thousands of miles worth hundreds or thousands in deductions annually. Driving from Santa Fe to properties in Taos or Española adds up fast.
The catch is you need contemporaneous records. This means logging your trips as they happen, not reconstructing them from memory at tax time. The IRS specifically requires a record of the date, destination, business purpose, and miles driven. A notebook in your car works. Mileage tracking apps like MileIQ work better because they run automatically and reduce the chance of forgetting.
Some landlords try to estimate mileage at year end based on how often they think they visited each property. This approach fails audits. If you can’t produce a log showing actual trips, the IRS can disallow the entire deduction. The documentation burden isn’t heavy if you build the habit, but it does require consistency.
Working with small business bookkeepers in New Mexico who understand rental property accounting helps ensure you’re capturing all your deductible expenses, not just the obvious ones. Mileage is easy to overlook when you’re focused on larger items like repairs and depreciation.
If you’re currently managing rental properties without tracking mileage, start now. Even if you’ve missed previous years, going forward with proper records means you’ll capture the deduction from here on out. It’s one of the easier rental property deductions to claim as long as you have the documentation to back it up.
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