top of page

Optional Standard Mileage Rates

January 19, 2024



Businesses can generally deduct the full cost of operating an automobile for business use. They may also choose to use the standard mileage rate method to calculate automobile expenses. The deduction is calculated by multiplying the standard mileage rate by the number of business miles driven. Self-employed individuals and employees, who receive no or partial reimbursement from the employer, may use this method.

 

The standard mileage rate method simplifies recordkeeping because taxpayers don’t need to keep records of actual expenses. However, you still need to keep a mileage log including date, place, purpose and miles driven (see appendix A). The business standard mileage rate considers costs such as maintenance and repairs, gas and oil, depreciation, insurance, and license and registration fees.

 

In 2023 and 2024, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) are:


As a result of the Tax Cuts and Jobs Act for tax years 2018 through 2025, mileage related to unreimbursed business expenses and moving expenses are limited to certain taxpayers.

  • Business expenses:

    • Unreimbursed business expenses subject to a 2% floor as an itemized deduction have been eliminated.

    • Eligible taxpayers for business mileage expenses: 

      • Members of a reserve component of the U.S. Armed Forces,

      • State and local government officials paid on a fee basis, and

      • Certain performing artists

  • Moving expenses:

    • Eligible taxpayers for moving expenses: 

      • A member of the Armed Forces of the United States on active duty, and

      • Moving under a military order and incident to a permanent change of station.

 

Taxpayers have the option of calculating the actual costs of using their vehicle rather than using the standard mileage rates. If the actual expense method is chosen, the taxpayer needs to maintain adequate records of sufficient evidence to substantiate the actual expenses.



[AppendixA] Automobile Mileage Log Template
.xlsx
Download XLSX • 12KB

 

 

תגובות


© 2021 TOPC Potentia All Rights Reserved

TRAIANGL-TOP-WHT.png
bottom of page