IRS Issues 2010 Mileage Rates

The IRS announced Thursday (Revenue Procedure 2009-54) the standard mileage rates for computing deductible costs of operating an automobile that are paid or incurred on or after Jan. 1, 2010. For business use of an automobile, the rate is 50 cents a mile. For medical or moving expenses, it is 16.5 cents a mile. For services to charitable organizations, the rate is 14 cents a mile. For tax year 2009, the rates were 55 cents, 24 cents and 14 cents, respectively.


The decreases reflect, for the business rate, changes in the past year in fixed and variable costs of operating an automobile, and for the medical/moving rate, changes in variable costs, the IRS said. The charitable rate is set by IRC § 170(i) and was last increased (from 12 cents) by the Taxpayer Relief Act of 1997. Rather than using the standard mileage rates, taxpayers may instead use their actual costs.



Year-end tax planning strategies

Practitioners should consider the timing of income and deductions, avoiding the net investment income tax, donating to charity, and planning for retirement.


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Return due dates changed in highway funding bill

The federal highway funding extension bill signed into law on July 31 contains several tax provisions, including changing the due dates for partnership, S corporation, and corporate tax returns.