IRS Audit

An IRS audit is a review of a tax return for accuracy. Mileage deductions are one of the most-questioned categories because they are easy to estimate and hard to verify without a clean log.

Three types of audit

• Correspondence audit: by mail. Most common type. The IRS requests documentation for specific items.
• Office audit: in person at an IRS office. Larger scope.
• Field audit: at your home, business, or accountant's office. Most thorough.

Why mileage gets flagged

Round numbers (exactly 20,000 business miles), high business-use percentages on mid-range vehicles (95%+ business use is unusual), and large year-over-year deduction swings can all trigger review. A claim of 30,000 business miles on a vehicle with only 32,000 total miles raises questions about plausibility.

What holds up

A contemporaneous log with the four required fields (date, destination, business purpose, miles), spread evenly across the year, with totals matching odometer readings, and consistent with stated business activity. Auto-tracking apps that timestamp trips at the moment of the drive produce logs that are by-construction contemporaneous.

How long records must be kept

Three years for normal audits, six years if substantial under-reporting is alleged, indefinitely if fraud is suspected. Most tax professionals recommend keeping mileage records seven years.

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