Posts Tagged ‘business miles’

2012 Mileage Rates

Wednesday, February 29th, 2012

 The cost of gas is going up again but the IRS has not updated the 2012 mileage rates to reflect the increased price.  Effective January 1, 2012, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) will be:

55.5 cents per mile for business miles driven
23 cents per mile driven for medical or moving purposes
14 cents per mile driven in service of charitable organizations

The rate for business miles driven is unchanged from the mid-year adjustment that became effective on July 1, 2011. The medical and moving rate has been reduced by 0.5 cents per mile.

Acording to the IRS, taxpayers always have the option of calculating the actual costs of using their vehicle rather than using the standard mileage rates. A taxpayer may not use the business standard mileage rate for a vehicle after using any depreciation method under the Modified Accelerated Cost Recovery System (MACRS) or after claiming a Section 179 deduction for that vehicle. In addition, the business standard mileage rate cannot be used for more than four vehicles used simultaneously. These and other requirements for a taxpayer to use a standard mileage rate to calculate the amount of a deductible business, moving, medical or charitable expense are in Rev. Proc. 2010-51.

Notice 2012-01 contains the standard mileage rates, the amount a taxpayer must use in calculating reductions to basis for depreciation taken under the business standard mileage rate, and the maximum standard automobile cost that a taxpayer may use in computing the allowance under a fixed and variable rate plan.

Additional information can be found at http://www.irs.gov/newsroom/article/0,,id=250882,00.html

 

IRS Revises Mileage Reimbursement Rate for 2011

Tuesday, July 12th, 2011

In Announcement 2011-40, the Internal Revenue Service (IRS)  has revised the optional standard mileage rates for computing the deductible costs of operating an automobile for business purposes.  While gasoline costs are a major factor the IRS also considered depreciation and insurance and other fixed and variable costs when revising the rate from  $0.51 cents per mile to $0.55 cents per mile effective July 1, 2011. If your employee handbook follows the IRS optional standard mileage rates, please be sure to adjust your business mileage reimbursements.

The new six-month rate for computing deductible medical or moving expenses will also increase by 4.5 cents to 23.5 cents a mile, up from 19 cents for the first six months of 2011. The rate for providing services for charitable organizations is set by statute, not the IRS, and remains at 14 cents a mile.

Mileage Rate Changes

Purpose Rates 1/1 through 6/30/11 Rates 7/1 through 12/31/11
Business 51 55.5
Medical/Moving 19 23.5
Charitable 14 14

2011 Mileage Reimbursement Rates Increasing

Wednesday, December 29th, 2010

The Treasury Department has increased the standard mileage reimbursement rates effective January 1, 2011 ( although only a one cent increase)  to 51 cents per mile for business miles driven. Additional increased mileage rates are as follows:

  • 19 cents per mile driven for medical or moving purposes
  • 14 cents per mile driven for service of charitable organization

More information is availalbe at http://www.irs.gov/newsroom/article/0,,id=232017,00.html