Can my mileage deduction be almost as much as my self-employment income?

This is actually quite common for businesses that are just starting out, especially service businesses that require a lot of driving. The standard mileage rate (65.5 cents per mile in 2023) adds up quickly! A few things to consider: 1) Are you properly tracking business vs. personal miles? Only business miles count for the deduction. 2) The start-up phase often has a higher mileage-to-income ratio because you're doing a lot of networking, quoting, and supply runs without the established client base yet. 3) For lawn care specifically, winter/early spring is typically low income but can still require significant travel. What matters is that you're keeping accurate records. Use a mileage tracking app or detailed logbook that notes the date, business purpose, starting point, destination, and miles driven for each trip. The IRS can be particularly strict about mileage documentation.

I went through similar issues when I started my mobile dog grooming business. The mileage vs income thing was stressing me out until I found taxr.ai (https://taxr.ai) which helped me understand what's normal for service businesses. I uploaded my mileage logs and early income statements, and their analysis showed my numbers were actually typical for a new mobile service business. The tool explained that a high mileage-to-income ratio is expected in the early quarters, especially in businesses where you have to travel to clients. What really helped was seeing how my numbers compared to similar businesses in their database. They also flagged a few trips I had documented poorly, which could have been problematic if I'd been audited. Definitely worth checking out if you're worried about your numbers or documentation.

Wanted to follow up on my skeptical comment earlier - I actually ended up trying taxr.ai after continuing to stress about my own mileage to income ratio (mine was even higher than yours for my first two months as a mobile hairstylist). I was genuinely surprised by how helpful it was. Beyond just saying "yes this is normal," it showed me exactly where my driving patterns could be optimized and even identified a few clients that were costing me money due to the distance. It also found a few business trips I had completely forgotten to log! The comparison to other businesses in my field was eye-opening. Turns out I'm actually more efficient with my miles than most other mobile service providers in their database. Sorry for being so dismissive before - it's not just another generic tax tool.

If you're really worried about the IRS questioning your mileage deduction, you might want to get ahead of any potential issues. I had a similar situation with my consulting business last year - lots of miles, not much income at first - and ended up getting a letter from the IRS questioning my deductions. Took me FOREVER to get someone on the phone. I finally used Claimyr (https://claimyr.com) and got through to an IRS agent in about 20 minutes when I'd been trying for days on my own. They have this demo video that shows how it works: https://youtu.be/_kiP6q8DX5c The agent was actually really helpful and explained exactly what documentation I needed to support my mileage claims. Having that conversation early saved me a ton of stress later. Sometimes being proactive with the IRS is way better than waiting for them to come to you.

I need to apologize for my skeptical comment about Claimyr. After continuing to fail at reaching the IRS for two more weeks about a different tax issue, I finally broke down and tried it. I'm shocked to say it actually worked exactly as promised. Got connected to an IRS representative in about 25 minutes when I had wasted hours upon hours trying on my own. The agent answered all my questions about my rideshare business mileage deductions and now I feel 100% confident about my documentation approach. Seriously kicking myself for wasting so much time trying to do it myself. Sometimes it's worth paying for a service that saves you that much frustration.

Something else to consider - are you sure you're using the correct mileage rate? The IRS increased it mid-year in 2022, and it went up again for 2023. Make sure you're using the right one for your calculations. Also, don't forget that you can choose between taking the standard mileage deduction OR deducting actual expenses (gas, maintenance, insurance, depreciation, etc.). You should calculate both ways to see which gives you the better deduction. Just remember once you choose actual expenses for a vehicle, you can't switch to standard mileage later for that vehicle.

Have you considered adjusting your business model to reduce driving? When I started my house cleaning business, I had similar issues - tons of miles but not much income. I started focusing on getting multiple clients in the same neighborhoods/areas and scheduling them on the same days. Cut my mileage by almost 40% while increasing my income. For lawn care, maybe you could offer discounts to neighbors of existing clients? Or charge a bit more for outlying areas to offset the driving costs?