Resources

Standard Mileage Rates For 2016

Beginning on January 1, 2016, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) will be:

  • 54 cents per mile for business miles driven
  • 19 cents per mile driven for medical or moving purposes
  • 14 cents per mile driven in service of charitable organizations

The business mileage rate decreased 3.5 cents per mile and the medical, and moving expense rates decrease 4 cents per mile from the 2015 rates. The charitable rate is based on statute.

The standard mileage rate for business is based on an annual study of the fixed and variable costs of operating an automobile. The rate for medical and moving purposes is based on the variable costs.

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 any vehicle used for hire or for more than four vehicles used simultaneously.

Taxpayers always have the option of calculating the actual costs of using their vehicle rather than using the standard mileage rates. But once actual costs are used, switching back to the standard mileage rates is not permitted.

If you have questions about deductions available in connection with the operation of a vehicle, please contact June.

Other useful information and resources:

IRS Tax Information for Individuals (http://www.irs.gov/individuals/index.html)

IRS Tax Information for Businesses (http://www.irs.gov/businesses/index.html)

Office of Management and Budget (http://www.whitehouse.gov/omb/)