Tax Log Book: What to Record, Format, and How Long to Keep

A tax log book is the running record you keep of business expenses so the IRS will actually let you deduct them. Federal law puts the burden of proof on you, and for certain categories of spending, a bank statement or credit card charge is not enough on its own. If the log is missing or incomplete, the IRS treats the expense as personal, and you can face a 20-percent accuracy-related penalty on top of the extra tax.¹ Keeping the log takes a few minutes a week. Losing a deduction because you didn’t costs real money.

Which Expenses Actually Require a Log

Section 274 of the Internal Revenue Code singles out four categories of expenses that get no deduction at all without adequate records: business travel (including meals and lodging away from home), business gifts, local transportation like mileage, and listed property such as a vehicle used for both work and personal driving.² For these categories, the IRS can disallow the entire deduction if the log is missing details, even when you clearly spent the money on business.

A couple of caps are worth knowing before you start logging. Business meals are deductible at 50 percent of the cost in 2026, as long as business is actually discussed and the meal isn’t lavish.³ Promotional items costing $4 or less with your name permanently imprinted on them don’t count toward that limit.

Listed property gets extra scrutiny because these assets sit on the line between business and personal use. Under current law, it includes passenger automobiles, other transportation vehicles, and property typically used for entertainment or recreation.⁴ Without adequate records of business use, you lose both the operating expense deduction and any depreciation or Section 179 write-off on the asset.

The Four Elements Every Entry Must Contain

For each expense covered by Section 274, the IRS wants four pieces of information. Miss any one and the entry may be treated as if it doesn’t exist.²

Amount. The dollar cost, supported by a receipt, invoice, or bank record.
Time and place. The date of the expense and where it happened. For travel, that means the city or area and the dates you left and returned.
Business purpose. A brief description of why you incurred the expense and how it relates to your work. “Lunch” isn’t enough. “Lunch with supplier to discuss Q3 inventory order” is.
Business relationship. Who received the benefit and their professional connection to you. For a meal, write down the names of the people at the table and why you do business with them.

Publication 463, the IRS guide for travel and car expenses, adds that documentary evidence like a receipt is generally adequate when it shows the amount, date, place, and essential character of the expense.⁵ A receipt captures the first two elements automatically. The business purpose and relationship are the parts you have to write down yourself, and they’re where most log books fall short.

Vehicle Mileage: The Most Common Log

Vehicle expenses are the most common reason people keep a log book, and also where the IRS finds the most problems. For 2026, the standard mileage rate is 72.5 cents per mile for business driving, 20.5 cents per mile for medical or qualifying military moves, and 14 cents per mile for charitable volunteer driving.⁶ Claiming any of those rates requires a mileage log.

Each entry in a vehicle log should include the date, starting and ending odometer readings, destination city or area, and the business purpose of the trip. You also need total miles driven for the year so the IRS can calculate your business-use percentage.⁵ A GPS app handles odometer and destination automatically, but you still have to tag each trip with its business purpose.

If you use the actual expense method instead of the standard rate, you also need receipts for gas, insurance, repairs, tires, registration, parking, and tolls. If you’re depreciating the vehicle, keep records of the original cost, the date you placed it in service, and any improvements.⁷ Each cost gets multiplied by your business-use percentage, which is why the mileage log still matters under this method too.

Commuting Is Never Deductible

The drive between home and your regular workplace is commuting, and commuting is personal no matter how far you travel. This is the distinction that trips up the most people. Driving between two work locations during the day is deductible business mileage, and so is driving from home to a temporary work site when you have a regular office elsewhere.⁵ If your home is your principal place of business, trips from home to any other work location in the same trade or business qualify regardless of distance. The IRS knows the distance between your home and your office. Padding a daily commute into business mileage is one of the fastest ways to draw a closer look at your return.

Sampling Periods

You don’t have to log every single trip for twelve straight months if your driving patterns are consistent. The IRS allows detailed records for a representative portion of the year, extrapolated to the full year, as long as you can show the sample reflects your typical use.⁵ A three-month sample during a normal business period often works. If your driving changes seasonally, one quarter won’t be representative.

When to Record and What Format Works

Timing matters. Treasury regulations say an entry is timely when you have “full present knowledge” of the details, and the IRS specifically confirms that a log kept on a weekly basis qualifies.⁸ A record built months later from memory carries far less weight. The regulation doesn’t technically require a contemporaneous log, but it warns that after-the-fact entries lack the credibility of ones made in real time.

Format is flexible. Paper notebooks, spreadsheets, and dedicated mobile apps all qualify. The IRS accepts computer-generated logs, including entries created by GPS tracking software, as long as the record captures each required element.⁸ Automation covers the mechanical parts. The judgment calls (why the trip happened, who the meal was with) are still yours.

At the end of each month or quarter, total your entries so the year-end numbers are ready when you prepare your return. If you file a Schedule C, the summary feeds directly into your expense lines. Running totals also help you spot errors or missing entries before they become a problem in an audit.

Employees With Reimbursements Need a Log Too

Employees who get expense reimbursements from an employer still need to keep a log. The tax treatment of those reimbursements depends on whether the employer’s plan qualifies as an “accountable plan,” which requires three things: a business connection for the expense, substantiation to the employer within a reasonable time, and return of any excess reimbursement.⁹

The IRS safe harbor deadlines are 60 days to substantiate the expense and 120 days to return any excess.⁹ Miss the windows or fall short on any of the three requirements, and the reimbursement gets treated as taxable wages on your W-2, complete with income tax, Social Security, and Medicare withholding on money that should have been tax-free. The deduction for unreimbursed employee business expenses has been permanently eliminated, so if a reimbursement turns taxable because you didn’t substantiate properly, there’s no itemized deduction to recover it.

What Happens If Records Are Missing

For most business deductions, a legal principle called the Cohan rule can save you. It lets a taxpayer who clearly incurred a deductible expense but can’t produce exact records claim a reasonable estimate, provided some factual basis supports the number. Courts applying the rule have noted that absolute certainty is usually impossible and unnecessary.

The harsh part: Cohan does not apply to the very expenses that most commonly need a log. Travel, meals, gifts, and listed property all fall under Section 274(d), and the regulations explicitly override the Cohan approximation doctrine for those categories.¹⁰ Lose your mileage log and fail to reconstruct it with corroborating evidence, and the deduction is gone. No estimates, no second chances.

If you have to reconstruct, pull everything you can: bank and credit card statements, appointment calendars, email confirmations, client correspondence, phone GPS history. The IRS will accept secondary evidence that, taken together, corroborates each of the four required elements. But the burden of proof stays on you, and the further you are from contemporaneous records, the less forgiving the examiner will be.

How Long to Keep the Log

The general rule is three years from the date you filed the return, matching the standard audit window.¹¹ Several situations extend that clock:

Six years if you fail to report income exceeding 25 percent of the gross income shown on your return.¹²
Seven years if you claim a deduction for worthless securities or bad debts, measured from the return’s due date.¹²
Four years for records tied to employment tax filings, measured from the fourth-quarter return for that year.¹³
Indefinitely if you never file a return, because no statute of limitations begins to run.

State tax authorities often follow the federal three-year window, though some apply longer periods. Keeping records for at least seven years covers the longest federal scenario and most state variations. Scan paper receipts, back up the log to cloud storage, and a faded slip of paper won’t cost you a legitimate deduction years later.

1
Internal Revenue Service. Accuracy-Related Penalty
2
Office of the Law Revision Counsel. 26 USC 274 – Disallowance of Certain Entertainment, Etc., Expenses
3
Office of the Law Revision Counsel. 26 USC 274 – Disallowance of Certain Entertainment, Etc., Expenses26 US Code 274 – Disallowance of Certain Entertainment, Etc., Expenses
4
Office of the Law Revision Counsel. 26 USC 280F – Limitation on Depreciation for Luxury Automobiles
5
Internal Revenue Service. Publication 463 (2025), Travel, Gift, and Car Expenses
6
Internal Revenue Service. IRS Sets 2026 Business Standard Mileage Rate at 72.5 Cents Per Mile
7
Internal Revenue Service. Car and Truck Expense Deduction Reminders
8
eCFR. 26 CFR 1.274-5T – Substantiation Requirements (Temporary)
9
eCFR. 26 CFR 1.62-2 – Reimbursements and Other Expense Allowance Arrangements
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eCFR. 26 CFR 1.274-5A – Substantiation Requirements
11
Internal Revenue Service. How Long Should I Keep Records?
12
Internal Revenue Service. Topic No. 305, Recordkeeping
13
Internal Revenue Service. Employment Tax Recordkeeping