The IRS has issued the standard mileage rates for 2019. Do keep in mind since the new Tax Cuts & Job Act (TCJA) there have been changes to claiming certain travel and moving expenses. Starting January 1st , 2019 the standard mileage rate for the use of a car, pickup, panel truck or van are shown in the table below. Since these rates have gone into effect starting in 2019, they will show up on your 2019 return to be filed in 2020, if they still apply to you. When filing for the 2018 tax year, you will still use the 2018 standard mileage rates that are submitted this 2019 tax season. Click Here to see the standard mileage rates for 2018.
|Business Mileage||58 cents per mile||54.5 cents per mile|
|Medical Mileage||20 cents per mile||18 cents per mile|
|Moving Mileage||20 cents per mile||18 cents per mile|
|Charitable Organization Mileage||14 cents per mile|
The reason for the difference in rates for business and medical or moving purposes is based off different aspects of variable costs. The standard mileage rate for business purposes is based on a study of the fixed and variable costs of operating an automobile, including depreciation, insurance, repairs, tires, maintenance, gas and oil. The standard mileage rate for medical or moving purposes is based the variable costs such as gas and oil. Taxpayers also have the option to calculate the actual costs of using their vehicle rather than using the standard mileage rates, if they’re willing to put in the extra work.
Taxpayers are able to use more than one mileage rate when filing their return, so if mileage is put on your vehicle because of more than one use, you will need to make sure that you keep accurate records of how the mileage is being added up. Below is an example of how you would figure your total standard mileage deduction rate for 2019 when your car is used for more than one eligible purpose.
If you drive 35,000 miles in one year and you’ve figured that 20,000 were for personal use, 10,000 were for business use and 5,000 were for medical use, below is how you would figure your standard mileage deduction.
20,000 personal mileage x $0 = $0
10,000 business mileage x $0.58 = $5,800
5,000 medical mileage x $0.20 = $1,000
If a taxpayer uses any depreciation method under the Modified Accelerated Cost Recovery System (MACRS) or claiming Section 179 deduction for that vehicle, then they are no longer able to use the business standard mileage rate for a vehicle. Also, the standard mileage rate can only be used for four vehicles simultaneously.
Since the Tax Cuts & Job Act, taxpayers can no longer claim the miscellaneous itemized deduction for unreimbursed employee travel expenses. Taxpayers are also no longer able to claim a deduction for moving expenses, except active duty military that are moving under orders to a permanent duty station.
View more posts involving changes since the Tax Cut’s & Job Act:
By: Paige Knight