Wednesday, November 21, 2012

IRS Increases Mileage Rate to 56.5 Cents per Mile

The IRS today announced the increase of the standard mileage rates for the 2013 tax year.

The standard mileage rates are the following:

Business    Medical
Moving
Charitable
2013

56.52414
July 1, 2011 -
Dec. 31, 2012

55.523.514
Jan. 1, 2011 -
June 30, 2011

511914
2010

5016.514
2009

552414
July 1, 2008 -
Dec. 31, 2008

58.52714
Jan. 1, 2008 -
June 30, 2008

50.51914
2007

48.52014
2006

44.51814, 32*, 44.5**
September 1 -
December 31, 2005

48.52214, 34*, 48.5**
August 25 - 31, 2005

40.51514, 29*, 40.5**
January 1 -
August 24, 2005

40.51514
200437.51414

* - Hurricane Katrina deduction
** - Hurricane Katrina reimbursement

To calculate use of personal vehicle for tax purposes, you can use one of two methods: standard mileage rate or actual expenses. If you qualify for both, calculate the deduction under both methods to see which gives you a larger deduction.

Actual expenses consist of the following costs:
  • Depreciation
  • Lease payments
  • Tires
  • Insurance
  • Registration fees
  • Garage rent
  • Parking fees
  • Licenses
  • Tags
  • Repairs
  • Gas and oil
The car expenses can also include parking fees and tolls under either method. Note: this does not include commuting expenses, these are never deductible.

Once you elect to claim actual expenses when you first begin using the car for business you cannot change to the standard rate deduction later.

No comments:

Post a Comment