Optional Rates Are Increased From 2017
The Internal Revenue Service (IRS) has issued the 2018 optional standard mileage rates used to calculate the deductible costs of operating an automobile for business, charitable, medical, or moving purposes.
2018 Standard Mileage Rates
Beginning on January 1, 2018, the standard mileage rates for the use of a car (also vans, pickups, or panel trucks) will be:
- 54.5 cents per mile for business miles driven (up 1 cent from 2017)
- 18 cents per mile driven for medical or moving purposes (up 1 cent from 2017)
- 14 cents per mile driven in service of charitable organizations (unchanged from 2017)
Taxpayers always have the option of calculating the actual costs of using their vehicle rather than using the standard mileage rates.
Limitations on Use of 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 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.
IRS Notice 2018-03 contains additional information about mileage rates.
For more on employer-provided transportation benefits, please see our section on Fringe Benefits.
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Please Note: The information and materials herein are provided for general information purposes only and are not intended to constitute legal or other advice or opinions on any specific matters and are not intended to replace the advice of a qualified attorney, plan provider or other professional advisor. This information has been taken from sources which we believe to be reliable, but there is no guarantee as to its accuracy. In accordance with IRS Circular 230, this communication is not intended or written to be used, and cannot be used as or considered a ‘covered opinion’ or other written tax advice and should not be relied upon for any purpose other than its intended purpose.
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