RayM
Just Another Club Racer
Joined: 25 Nov 2006
Posts: 1316
Location: Upsidedown on the track
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 Posted: Sat Jul 05, 2008 8:17 am Post subject: IRS Mileage changes |
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The Internal Revenue Service (IRS) announced an increase in the optional standard mileage rates for the final six months of 2008. Taxpayers may use the optional standard rates to calculate the deductible costs of operating an automobile for business, charitable, medical or moving purposes.
The rate will increase to 58.5 cents a mile for all business miles driven from July 1, 2008, through Dec. 31, 2008. This is an increase of eight cents from the 50.5 cent rate in effect for the first six months of 2008, as set forth in Rev. Proc. 2007-70.
In recognition of recent gasoline price increases, the IRS made this special adjustment for the final months of 2008. The IRS normally updates the mileage rates each fall for the next calendar year.
“Rising gas prices are having a major impact on individual Americans. Given the increase in prices, the IRS is adjusting the standard mileage rates to better reflect the real cost of operating an automobile,” said Doug Shulman, IRS commissioner. “We want the reimbursement rate to be fair to taxpayers.”
While gasoline is a significant factor in the mileage figure, other items enter into the calculation of mileage rates, such as depreciation and insurance and other fixed and variable costs.
The optional business standard mileage rate is used to compute the deductible costs of operating an automobile for business use in lieu of tracking actual costs. This rate also is used as a benchmark by the federal government and many businesses to reimburse their employees for mileage.
The new six-month rate for computing deductible medical or moving expenses also will increase by eight cents to 27 cents a mile, up from 19 cents for the first six months of 2008. The rate for providing services for charitable organizations is set by statute, not the IRS, and remains at 14 cents a mile.
The new rates are contained in Announcement 2008-63 on the optional standard mileage rates.
Taxpayers always have the option of calculating the actual costs of using their vehicle rather than using the standard mileage rates.
Mileage Rate Changes
............1/1/08 — 6/30/08 .............. 7/1/08 — 12/31/08
Business............50.5.............................. 58.5
Medical/Moving...19..................................27
Charitable..........14................................. 14
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Tight is when the front end of my car hits the wall first and loose is when the back end hits first."
and scrape marks on the top of the helmet is a wheels up condition. |
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