IRS Raises Standard Mileage Rate for Second Half of 2011


In response to rising gasoline prices, the IRS has raised the standard mileage rate for business use of an automobile from 51 cents per mile to 55½ per mile, effective July 1 (Announcement 2011-40). The medical and moving standard mileage rate is increasing to 23½ per mile, also on July 1.

 

The new optional standard mileage rates will apply until superseded by future guidance and can be used by taxpayers to calculate the deductible costs of operating an automobile. Alternatively, taxpayers can instead use their actual costs, but must maintain adequate records and be able to substantiate their expenses.

 

The standard mileage rate for services to charitable organizations is set by statute at 14 cents per mile and remains unchanged by Thursday’s announcement.

 

The former rates announced in Notice 2010-88 (51 cents per mile for business use, 19 cents per mile for medical and moving expenses) continue to apply to expenses incurred before July 1, 2011.

 

More from the JofA:

 

 Find us on Facebook  |   Follow us on Twitter  |   View JofA videos

SPONSORED REPORT

8 accounting and auditing issues you can’t afford to ignore

Download this sponsored report for an overview of some of the most important developments accountants and auditors are facing today.

DOWNLOAD

Filing season quick guide — Tax year 2014

Tax season started Jan. 20. Download our “quick guide,” a printable card that contains dollar thresholds, tax tables, standard amounts, credits, and deductions to keep at your fingertips during tax season.

TAX NEWS

Expired tax provisions extended for 2014

President Barack Obama signed legislation that retroactively extended more than 50 expired tax provisions for 2014, allowing taxpayers to take advantage of a host of tax incentives during this filing season.