New Mileage Rates Released and What They Mean


        The standard mileage rates that can be used to deduct the costs of operating a vehicle for business uses have been updated. When it comes to driving for business (57.5 cents per mile) or for moving (17 cents per mile), the rates have come down when compared to 2019. A half cent for business driving and 3 cents for the purpose of moving. One reason for this is that the mileage rate for business use is based on a yearly study of different costs related to using cars, trucks, vans, and pick-ups. Taxpayers always have the option using the actual cost of using their vehicle, instead of the mileage rate.

          The Internal Revenue Service (IRS) stated that under the Tax Cuts and Jobs Act (TCJA) only members of the Armed Forces on active duty, who are moving under orders, can claim a deduction for moving expenses. A taxpayer cannot combine the business mileage rate, with any other depreciation method. There are other limitations that have been put in place for business owners who use vehicles. To find out the best deductions that apply to your business, talk to your Qualified Tax Professional now. This way the records that you start keeping now will save you time and money later.

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