The IRS has announced the business standard mileage rate for 2012. Beginning on Jan 1, 2012, the standard mileage rates will be:
*55.5 cents per mile for business miles
*23 cents per mile driven for medical or moving purposes
*14 cents per mile driven in service of charitable organizations
The business rates are the same as what was set on July 1, 2011, but the medical and moving rate has been reduced by 0.5 cents per mile.
If you haven’t done so, take a look at our post that gives a good overview of the different apps available for logging your miles.
Remember, when you use your car for business, you can use the standard rates above (multiply the rate by the miles driven for that purpose), or you can always calculate the actual costs of using your vehicle.
Here are a couple of tips for using the standard rate:
- Remember that using the standard rate is instead of using actual operating and fixed costs. If you use the standard deduction, you should not have separate deductions for depreciation or leasing costs, maintenance or repairs, tires, gasoline (including taxes), oil, insurance, and registration fees.
- BUT (there’s always a but, isn’t there?) you can still deduct parking fees and tolls if you use the standard rate
- You can also deduct interest relating to the purchase of the automobile and any state and local personal property taxes as allowable in Section 163 and Section 164.
- If you use your car for hire (such as with a taxi) or if you have five or more autos simultaneously you can’t use the standard rate.
- You can’t use the standard rate if the purchased car was previously depreciated using any method other than the straight-line method, or if Section 179 or additional first-year depreciation has been claimed.
Please give our office a call at 770-478-7424 if you have any questions.
