Claiming Pizza Delivery Mileage On Your 2007 Taxes

This is a new and improved version of last year's tax post. The images below are photocopies (with my personal info removed) of my actual 2007 tax forms as printed by TurboTax.

First, the disclaimer. I am not an accountant nor am I a professional tax adviser. I have, however, made understanding taxes a hobby of mine for years and I feel that I know them pretty well.

Many pizza drivers wonder if they can claim their mileage on their taxes. This post is directed towards them.

The answer to the question is, yes, you can. It goes on Form 2106, Employee Business Expenses, which then becomes an itemized deduction on your 1040 Schedule A Itemized Deductions.

If you want to read what the IRS says, start by reviewing Topic 510, Business Use Of A Car.

What you need to know:

1. There are 2 methods: Actual expenses or mileage. Unless you are driving a newer car that you are still making high payments on, it is usually better (and almost always simpler) to use the mileage method.
2. If you claim expenses, you must also claim your reimbursements.
3. To claim your expenses, you must itemize your deductions on Schedule A. Unless you have a mortgage and pay a bunch of interest, or make large charitable donations, you are better off claiming the standard deduction.
4. Even if you itemize, your unreimbursed expenses must be at least 2% of your total income.

I personally did claim my mileage this year. I always claim 100% of my tips also, so fear of being audited is not an issue for me.

You fill all this information out on IRS Form 2106.


For example, here is my info for 2007:

Start on form 2106, page 2

Line 11: Date vehicle placed in service: 1/1/2007
Line 12: Total miles: 18,514
Line 13: Business miles: 7629
Line 14: Pct business use: 41.19%
Lines 15-16: I put 40 miles (for my other job) and a total of 9280
Line 17: 1608 (18,514 - 7629 - 9280)
Line 18-21: Yes
Line 22: $3699

Since I use the mileage method, not the actual expenses method, I can leave lines 23-38 blank.

Now move to Form 2106, page 1
Line 1: Vehicle expense from 22: $3699
Line 2: Parking fees, etc: 0
Line 3: Travel expenses: 0
Line 4: Business expenses: 0 (if you are claiming a cell phone, flashlights, maps, etc this is the spot).
Line 5: Meals and entertainment: 0
Line 6: Total Expenses: $3699

Line 7: Reimbursements: $1792 (this is your nightly per-run money)
Line 8: 3699 - 1792 = $1907
Line 9: $1907
Line 10: $1907

Now this total $1907 goes to line 20 on Schedule A, Job Expenses.

So since I itemize anyways, this extra deduction of $1907 for me saved me a few hundred dollars in taxes. I keep a delivery log anyways and I just write down my starting & ending mileage each night.

Again, since I use the mileage method, I do not have to track my car repairs, gasoline costs, etc.




Note once again that I am NOT an accountant, but I am confident that this information is accurate. However, I am not giving any advice here, just letting you know what I did. Study this and compare it to your own situation, and review the IRS publications, and decide for yourself.