IRS releases 2013 deductible mileage rates

PHOENIX, Ariz. – The Internal Revenue Service recently issued the 2013 optional standard mileage rates used to calculate the deductible costs of operating a vehicle for business, charitable, medical or moving purposes.

The rate for business miles driven during 2013 will increase 1 cent from the 2012 rate, as will the medical and moving rates. The charitable rate remains unchanged.

Effective Jan. 1, 2013, the standard mileage rates for the use of a car, van, pickup or panel truck will be 56.5 cents per mile driven for business, 24 cents per mile driven for medical or moving purposes and 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 a vehicle, while the rates for medical and moving purposes are based only on the variable costs. Taxpayers also have the option of calculating the actual costs of using their vehicle, rather than mileage rates.

A taxpayer may not use the business rate for a vehicle after using any depreciation method under the Modified Accelerated Cost Recovery System, or after claiming a Section 179 deduction for that vehicle. In addition, the business standard mileage rate cannot be used for more than four vehicles simultaneously.

These and other requirements for a taxpayer to use a standard mileage rate to calculate the amount of a deductible business, moving, medical or charitable expense are in Rev. Proc. 2010-51. Notice 2012-72 contains the standard mileage rates, the amount a taxpayer must use in calculating reductions to basis for depreciation taken under the business standard mileage rate and the maximum standard automobile cost that a taxpayer may use in computing the allowance under a fixed and variable rate plan.

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