Fleet management comes with a lot of paperwork—CDL licenses, training, inspections, hours of service (HOS), mileage, etc. All of this paperwork is required for compliance with regulations. However, tracking certain numbers, such as mileage, is more beneficial to your fleet than it is for any reporting agency. Your mileage does matter, in regards to calculating your CSA score, but it also matters when filing taxes and calculating tax deductions. Every business seeks opportunities for deductions. For fleets, one of the easiest deductions is mileage. To make sure you’re reporting mileage correctly your drivers should keep a mileage log. Below is everything you need to know about keeping a mileage log.
A mileage log is a meticulous record of the mileage driven in each vehicle, which sounds simple enough. However, many fleet companies feel it’s adequate to record mileage every week or month, but these records would not suffice for an IRS audit. The IRS needs a clear view of your operating expenses, including mileage. To do that, you need to record mileage for every single trip. This may sound tedious, but the right tools, such as a telematics system, can help by automatically recording this data and storing it in a centralized database.
There are very few requirements for mileage tracking by the IRS for tax purposes. The priority in mileage logging is that you log the mileage of each trip, for each vehicle. The IRS does have eligibility requirements for claiming mileage such as the type of business. You also cannot claim mileage incurred during personal use of the vehicle. This can be confusing for fleet drivers that take their vehicles home each day. You have to differentiate between the miles they put on the vehicle for work and commuting miles.
Along with mileage you should also record:
It can be difficult to record all of this for each trip, especially for fleets. Mileage logging apps or certain fleet management software makes this task much easier.
Many businesses simply estimate the mileage they use for their business. This works well enough for many, but it opens companies up to a greater risk if they’re audited by the IRS. In the case of an audit, you need to have detailed records of your mileage. There are even lawsuits in which the taxpayer lost years of deductions due to improper record keeping of mileage (Royster vs. Commissioner).
While it may not seem likely that you’ll face an audit, know that it is possible and you may face deduction losses. Sole proprietors face a higher risk of audit due to a lack of separation between personal miles and business miles. It is one of the most commonly scrutinized deductions for businesses, and it’s better to be prepared than not.
There are two types of deductions relating to mileage tracking: standard or actual expense deductions. The standard deduction is determined by the IRS, which was 58 cents per mile in 2019. The actual is input by the taxpayer. This would include detailed information about mileage, expenses, and records to support both.
As mentioned, the standard deduction is a preset deduction. When you use this deduction, you don’t get the option to deduct other expenses such as repairs, depreciation, and registration fees. This is generally a good option for individuals that travel for business in their personal vehicles, such as Uber drivers. But for large fleets, or for fleets that don’t use their vehicles for other purposes, they may not get their full deduction from this option.
The actual expense deduction allows you to calculate in your mileage, lease payments, fuel, registration fees, depreciation, maintenance, and more into your tax filings. With this method, you would calculate the total vehicle expenses and multiple it by the miles driven for business to find your total deduction.
Surprisingly, this is a common occurrence, especially among those new to using their vehicle for business. New fleets aren’t always accustomed to tracking mileage like expert drivers would be. Taking the standard deduction in these instances is generally advised. With the standard deduction, you can estimate your mileage out of your total vehicle costs.
It’s a different story for fleets with vehicles they use only for business purposes. If you didn’t log your mileage, consider taking the standard deduction and making estimates with what little evidence you have. Here are the steps you can take:
For the future, you should use a mileage tracking app, GPS tracking device that logs Hours of Service (HOS), or a total fleet management system. A full system will not only log your HOS, but it will also log and optimize other parts of your business and store this data in a centralized database. This makes it easier to recall the data you need, when you need it.
An IRS audit is something that no business wants to encounter, and if your business lacks the proper documentation, you may lose years of deductions. So, while there are few actual rules about logging your mileage, there are still guidelines you should follow. To keep a mileage log book with the proper information, you need to be as strict with your recordkeeping as the IRS would be in an audit.
To reap the full benefits of an IRS mileage deductible, your records must have the following information:
Many fleets like to store this information in a notebook to update by hand, or utilize an Excel spreadsheet. Options like these were the norm before the integration of fleet management software. No matter how you record this information, it’s vital that you do so for each trip and that the records are as detailed as possible. You must also keep these records for at least three years. Here’s what you need to do to accurately report your mileage to the IRS:
First you need to decide which calculation method you’re going to use. If you’re taking the standard deduction, then your recordkeeping doesn’t have to be as meticulous because it’s a preset deduction. Though we’d caution against being too lax with reporting because an audit could still occur with the standard deduction.
At the start of the year, take odometer readings for all of your vehicles. You will need the total miles driven on your Form 2106. You should also maintain a vehicle mileage log with all of the aforementioned information. You can do this with paper or Excel sheets, but the most efficient and accurate way to do this is to use a telematics device.
In addition to details on trips and mileage, you should also store any receipts that you incur throughout your trip. You can also keep receipts for maintenance and equipment. It can be difficult to ensure you always get every receipt from your drivers and staff. However, there are solutions to this issue. A comprehensive fleet management software solution will include features such as fuel card integration. This would eliminate the need to keep all fuel receipts from each trip and vehicle since you’d be able to see these records on demand. This software stores these details in a centralized database for easy analysis and recall—vital during inspections. You should also sign up for automatic notifications and receipts wherever possible to further simplify your recordkeeping. If this isn’t possible, and you receive paper receipts, consider scanning them to a dedicated file on a central server or cloud storage.
You must retain your documents for at least three years in the case of an audit. It doesn’t matter how you store this data. However, if you have a large fleet and have difficulty staying organized and up to date, then telematics may be your best option. Telematics systems document mileage automatically and use cloud-based technology that can be accessed from anywhere. It can also log receipts, fuel stop locations and costs, maintenance receipts and costs, and so much more.
Fleet management software helps you stay up to date with all of your fleet’s movements. This smart software can store data for years to be used for analytics, predictive maintenance, and cost management. But fleet management software can do so much more than this. It also provides route optimization and planning, maintenance scheduling and alerts, driver behavior monitoring, engine diagnostics monitoring, and idling and utilization reporting.
Learn more about what fleet management software can do for your fleet, at Azuga.
Tracking fleet data is vitally important to running a fleet in any industry. Any kind of data can be tracked, from where vehicles are, to what assets a company has on hand, to the safety of drivers and vehicles. All of this information is important for fleet managers to know to make their fleet effective and productive. What is fleet data, and how can it help fleets be more effective?
Keeping up with vehicle maintenance is one of the best ways to keep vehicles on the road for the long haul. With how much time fleets spend driving, wear and tear on a vehicle is inevitable, but fleet managers can reduce this by harnessing telematics and maintenance alerts. Telematics can tell managers when a vehicle has engine trouble or when a driver is being rough on the brakes or idling too much. Managers can also set up maintenance alerts so they do not have to try and remember when each vehicle needs routine maintenance. Preventative maintenance is crucial to a vehicle’s longevity and will help it stay on the road for years to come.
Any fleet’s top priority is safety. Drivers and vehicles are integral to a fleet business’s entire operation, and ensuring that they do their jobs safely is a huge part of a fleet manager’s job. Luckily fleet data can track driver behavior and determine if drivers are behaving safely behind the wheel. Telematics can track actions such as hard braking, rapid acceleration, distracted driving, and speeding. When drivers display any of these behaviors, they will receive an alert. If the behaviors continue, the system will alert the fleet manager, who can then choose to get in touch with the driver. Accidents can cost thousands of dollars, and days of lost time for businesses, so avoiding them is crucial for companies to succeed.
Asset tracking is terrific for preventing theft, but it is also ideal for fleet managers to keep track of what they have on hand in their warehouse. Often, assets and equipment sit unused in a warehouse, taking up space that something practical could be occupying. With asset data, fleet managers can determine what assets the fleet does not use and get rid of them, making room for something that will be more beneficial for the company. Furthermore, knowing what’s on hand prevents double-purchasing, which saves the company money as well.
Tracking fleet data is essential for keeping a fleet productive and effective. It is all part of a fleet manager’s job. Luckily, Azuga has many tools to help with tracking fleet data. Reach out to the experts at Azuga today to find out how to get started gathering data today so that you can do the best for your fleet.
Each driver is required by the law to record a driver’s duty of status every 24 hours, using the structures stipulated by the Federal Motor Carrier Safety Administration (FMCSA). A record of duty status (RODS) can also be referred to as a driver’s log. It allows drivers to record details such as date, vehicle number, totals driving hours, the total number of miles driven within 24 hours, carrier’s name, a 24-hour period starting time, address, driver’s certification/signature, and remarks.
Records can be maintained using an electronic logging device (ELD), using an FMCSA approved automatic on-board recording gadget, or even manually on a grid. Logs must be validated at all times by indicating each change in a duty status.
A RODS is mandatory as part of Hours of Service (HOS) rules, which applies to commercial vehicles (CMVs). However, a few cases of short-haul carriers are exempt from maintaining records of duty status.
Company policies may be different, but the FMCSA only expects drivers to record time and location after every stop.
Since the introduction of the ELD mandate, several motor carriers are leaning toward electronic logging devices to maintain their records of duty status automatically. Companies were given until December 16, 2019 to update automatic on-board recording devices to the latest ones, meaning there were also some exemptions to the ELD Rule.
Exemptions to RODS regulations include the following:
For drivers to qualify for the exemption, they must meet all the requirements stated by the regulations. Failure to meet even one of the requirements means all HOS rules apply.
A driver must produce ELD records when requested by a safety official, either immediately, or within the permissible time if the motor carrier operates from more than one terminal or office. A motor carrier is supposed to retain a back-up copy of all ELD records for at least six months.
Only carriers or drivers falling under the exempted categories may use other recording methods, which may include automatic onboard recording devices (AOBRDs) to maintain driver record of duty status.
Being exempted from the ELD rule does not mean you are automatically exempted from the HOS regulations. A driver is required to submit original paper log sheets to their respective carriers within 13 days after the completion of their trips. The driver retains a copy of all RODS for the previous seven days, which must be produced on request for inspection at the time they are on duty. Drivers must also sign all hard copies of RODS.
The idea behind mandating the ELD rules was to provide accurate, consistent, and accessible methods of logging driver hours of service, and simultaneously create a safer working environment. The new measures were intended to ensure drivers took necessary breaks and rested appropriately, and to ensure they remained alert while driving. Making the switch from manual processes like logbooks to electronic hours of service tools makes it easier for businesses to keep up with the FMCSA requirements.
However, the implementation of electronic logging devices does not change the fleet manager’s responsibility to track off duty or driving hours. What it does require is that you make use of a log tracking device and software system.
The HOS rules apply to drivers operating CMVs such as school buses and semi-trucks. For a vehicle to be classified as a CMV, it must fulfil the following:
If a vehicle meets the qualifications above, it is required by the law to comply with HOS regulations and to maintain decent hours of service log.
Besides ordinary traffic violations and unsafe driving, it is common among drivers to fail to comply with HOS regulations. Hours of Service compliance counts as one of the core basics of CSA, and maintaining a low score is often a result of piling frustrations.
The ability to fix problems associated with hours of service is the most crucial way to keep safety scores in check, and helps in controlling the frequency of roadside inspections.
Below are the most common violations of Hours of Service and how you can fix them.
When entering data manually, issues like mathematical errors, poor handwriting, the omission of essential information, and many other mistakes, may arise. These are issues that can be minimized by implementing an electronic system that automatically fills in the required data when it is needed. Tired drivers can easily leave out essential data, which could be deemed a violation of the hours of service regulations.
The driver record of duty status graph shown on a log must always be up to date, showing each detail of changes. Forgetting, or simply failing to update duty status is common among drivers and leads to severe roadside inspections. It is mostly due to drivers failing on their mandate to remain vigilant by changing statuses.
It is easy to fix this recurring problem with the simple touch of a screen. All drivers have to do is to indicate the time their shifts start, and to change their status to off-duty when shifts end. Electronic logbooks are designed to detect when a vehicle is stationary or in motion, and gives accurate data at all times.
Failing to properly maintain your RODS and not maintaining logs for seven days is a violation that can lead to hefty fines. Drivers of companies running smaller vehicles may not be aware of what is required of them, but they must check with the relevant authorities. Inspectors ask for records of the previous seven days. Therefore, drivers must not misplace any record whatsoever.
Azuga works with you to deliver customized solutions for fleets and drivers. It doesn’t matter the size of your fleet, Azuga offers the right products and technology to duly maintain drivers’ records of duty status and keep you compliant with the hours of service regulations.
If you utilize company vehicles during the course of business, you might want to familiarize yourself with enterprise fleet management and maintenance. Operating a fleet can be a challenge. Luckily there are things that you can do to make your life a lot easier. In this article, we will answer what is an enterprise fleet? Plus, we’ll outline four key tips you should know about enterprise fleet management and an additional three tips about enterprise fleet maintenance.
An enterprise fleet, simply put, is a fleet of vehicles leased or owned by a business. Automotive Fleet Magazine defines enterprise fleets as commercial entities with 15 or greater vehicles. A wide range of businesses operate enterprise fleets. For example, delivery businesses and many businesses who do on-site service calls or have representatives travel to meet with clients have enterprise fleets.
The enterprise fleet industry is huge in the United States. Automotive Magazine recently released a report that outlines the number of cars and trucks that are leased or owned by enterprise fleets in the United States. Fleets in the U.S. leased 431,000 vehicles last year and owned 204,000 vehicles. There are a total of 727,000 trucks being leased by enterprise fleets and 1,860,000 trucks are owned by them.
In some areas, enterprise fleets are also made up of vehicles that are privately owned (or leased) by employees but used for business purposes. These are known as “grey fleet” vehicles.
Enterprise fleet management can be a challenge. It’s a fast-paced job that requires you to stay on your toes. Fleet managers are often responsible for drivers and accountable to management. Below are four tips on how to excel in enterprise fleet management:
When a business lacks purchasing and disposal guidelines for fleet vehicles they may be giving up thousands of dollars through inefficiencies. Consistency is very important in enterprise fleet management.
Your company should look into bulk purchasing and understand the right time or number of miles at which to best sell a vehicle. Enterprise fleet managers should spec out options for fleet vehicles and assemble a purchasing plan. In addition, they should gain insight into the optimal time to dispose of fleet vehicles.
Fleet drivers face a whole host of distractions and safety hazards on the job. Great fleet managers know how to get ahead of things that might become problems. Invest in safety before accidents happen.
Investing in safety may look like hands-free devices for your drivers, installing an app that monitors driver behavior on their phones, or an in-cab camera that oversees drivers while they’re on the road. Ultimately, being proactive about safety will save your company money in the long run.
Many fleet managers find it useful to incentivize drivers to perform well. Drivers may be encouraged to achieve higher fuel efficiency or perform vehicle inspections regularly. No matter what goal you set, you should hold your drivers to a high-performance standard.
Driver behavior monitoring makes it simple to set goals and encourage safe driving habits. Actionable goals help managers encourage drivers to improve their driving habits.
The best fleet managers know that the fleet industry is constantly changing and it's vital that managers keep up. Top fleet managers join industry associations, read trade publications and blogs, and overall keep up with what is happening in the industry.
Often fleet managers will discover new technologies to adopt when reading up on the fleet industry. This helps them keep ahead of the competition. With so much information readily available online, it’s never been easier for fleet managers to keep up-to-date and ahead of the curve.
Fleet maintenance is integral to running a top-performing enterprise fleet. Here are three tips on how to excel at enterprise fleet maintenance:
Pay attention to your maintenance costs and make note when they start to rise because of a vehicle’s age. Make sure you comprehend the warranty coverage provided by the manufacturer and the way it impacts the vehicle’s total cost of ownership. Those who excel at enterprise fleet management understand trends in the used vehicle market, the residual value of fleet vehicles, and the best time to sell fleet vehicles to obtain a cost-effective enterprise fleet.
A vital part of fleet maintenance is performing specs on vehicles. It’s important that this job is performed well. You should be aware of the demands your fleet vehicles will face. Make sure to outline vehicle usage.
The danger is that under-specing a fleet vehicle can lead to maintenance issues down the line that could put a dent in your budget. On the other hand, an over-spec’d fleet vehicle can also increase costs. Great fleet managers know the criteria involved with specing (operating conditions, what’s being carried, usage, etc.) and try to make theirs as accurate as possible.
One of the most important things to understand about enterprise fleet maintenance is the cost savings involved in preventative maintenance. Well-maintained fleet vehicles are less likely to require unscheduled downtime or repairs. Some examples of preventative maintenance are general vehicle safety checks, oil changes, and tire rotation, and inspection. Make sure to perform these activities on a regular schedule.
Good enterprise fleet management practices help leaders in the fleet management industry achieve more. Take your fleet to the next level when you implement smart technology like Azuga Fleet™. The Azuga team is here to help boost your fleet’s productivity, improve safety, and save you hundreds each year.