In order to make money in the restaurant business, prime costs should generally be in the 60 percent to 65 percent range. How that breaks down between food and labor is less important than achieving a prime cost maximum that produces a satisfactory profit.
The standard mileage rate is by far the easiest to use. With the standard mileage rate, you take the deduction of a specified number of cents for every business mile you drive. The IRS sets the standard mileage rate each year. The 2017 Mileage Rate is 53.5 cents per mile. To figure out your mileage deduction, simply multiply your business miles by the standard mileage rate for the specific year. Example: Ed, a salesperson, drove his car 20,000 miles for business during 2017.
Very often, this number is seen as a tax-free way to reimburse employees who drive their personal vehicle for business. However, this is not its true purpose. As mentioned, the IRS standard mileage rate exists as a way for individuals to write off the business expense of a personally owned asset. For example, this means that if a person drives 1000 business miles in a year, they could deduct $540 on their taxes according to that yearâs rate of 54 cents per mile.