The Internal Revenue Service has issued the 2015 optional standard mileage rates that are used to calculate the deductible costs of operating an automobile for business, charitable, medical or moving purposes.
January 1, 2015, the standard mileage rates for the use of a car, van, pickup or panel truck will be:
- 57.5 cents per mile for business miles driven, up from 56 cents in 2014
- 23 cents per mile driven for medical or moving purposes, down half a cent from 2014
- 14 cents per mile driven in service of charitable organizations
The standard mileage rate for business is based on an annual study of the fixed and variable costs of operating an automobile, including depreciation, insurance, repairs, tires, maintenance, gas and oil. The rate for medical and moving purposes is based on the variable costs, such as gas and oil. The charitable rate is set by law.
Business owners always have the option of claiming actual deductions based on the costs of using a vehicle rather than the standard mileage rates. There are some instances where they are not allowed to use the standard mileage rate; such as if the vehicle has been claimed for accelerated depreciation. The standard rate is also not available to businesses that own fleets (more than four vehicles used simultaneously).
There are many different rules for business vehicles, if you need further explanation, give us a call. We are here to help.