Attention road warriors! The IRS recently released Notice 2014-79, which provides the optional standard mileage rates for substantiating deductible expenses for using an automobile for business, moving, medical, or charitable purposes.
Beginning January 1, 2015, the standard mileage rates for business use of an automobile, van, pick-up truck or panel truck will be:
57.5 cents per mile for business miles driven (an increase of 1.5 cents from 2014)
23 cents per mile for an automobile as a medical or moving expense (a decrease of .5 cents from 2014)
You always have the option of calculating the actual costs of using your vehicle, as opposed to using the standard mileage rates. Sometimes, it may be more advantageous to do so. Consult with your tax advisor to determine the best route to take (pun intended).
The Notice also provides the amount you must use in calculating reductions to basis for depreciation taken under the business standard mileage rate and the maximum standard automobile cost you may use in computing the allowance under a fixed and variable rate (FAVR) plan.
To compute the allowance under a FAVR plan, the standard automobile cost may not exceed $28,200 for automobiles or $30,800 for trucks and vans.
The rules for using the optional standard mileage rates to calculate the amount of a deductible business, moving, medical, or charitable expense are in Rev. Proc. 2010-51.
As with all tax-filing advice, keep good records of your mileage and maintenance and make sure you can substantiate vehicle depreciation. A simple auto log book is probably the best bet. There are plenty of choices at your local office supply store.