2024 STANDARD MILEAGE DEDUCTION

Overview

The standard mileage deduction allows taxpayers to deduct a set amount per mile driven for various purposes, including business, charitable, medical, and moving expenses. This method simplifies the process of calculating vehicle expenses by providing a standard rate per mile, rather than requiring detailed records of actual expenses.

Standard Mileage Rates for 2024

• Business Use: 65.5 cents per mile
• Medical or Moving Use: 22 cents per mile
• Charitable Use: 14 cents per mile (set by statute and not subject to annual adjustment)

Eligibility and Use

• Business Use: Taxpayers can use the standard mileage rate for business purposes if they own or lease the vehicle and use it for business activities. This includes travel between different work locations, client visits, and other business-related travel.
• Medical or Moving Use: The standard mileage rate for medical or moving purposes can be      used for travel related to medical care or moving expenses for members of the Armed Forces on active duty who move due to a military order.
• Charitable Use: The rate for charitable use applies to miles driven in service of charitable organizations.

Requirements and Limitations

• Recordkeeping: Taxpayers must keep accurate records of the total miles and business miles driven each year. The records must include the date, purpose, and number of miles for each trip. There are mileage apps that will make it easy to keep a mileage log.
• Consistency: If the standard mileage rate is used in the first year the vehicle is placed in      service, taxpayers can switch to actual expenses in later years. However, if actual expenses are used in the first year, the standard mileage rate cannot be used in subsequent years.
• Depreciation: The standard mileage rate includes an allowance for depreciation. For 2024, the depreciation component is 28 cents per mile.
• Multiple Vehicles: Taxpayers cannot use the standard mileage rate for more than four      vehicles used simultaneously in business operations.

Calculation Example

To calculate the deduction using the standard mileage rate, multiply the number of miles driven by the applicable rate. For example, if a taxpayer drives 10,000 miles for business purposes in 2024, the deduction would be: 10,000 miles×0.655 dollars per mile=6,550 dollars10,000 \text{ miles} \times 0.655 \text{ dollars per mile} = 6,550 \text{ dollars}10,000 miles×0.655 dollars per mile=6,550 dollars

Reporting

• Form 1040, Schedule C: Self-employed individuals report business mileage on Schedule C.
• Form 2106: Employees who qualify to deduct unreimbursed business expenses (such as Armed Forces reservists, qualified performing artists, and fee-basis state or local      government officials) use Form 2106.
• Form 1040, Schedule A: Medical and charitable mileage is reported on Schedule A as      itemized deductions.

Additional Information

• Transition Rules: Taxpayers who switch from the standard mileage rate to actual      expenses must adjust the vehicle's basis for depreciation purposes.
• Leased Vehicles: If the standard mileage rate is used for a leased vehicle, it must be used for      the entire lease period.

References

• IRS Publication 463: Travel, Gift, and Car Expenses
• IRS Form 2106: Employee Business Expenses
• IRS Form 1040, Schedule C: Profit or Loss from Business
• IRS Form 1040, Schedule A: Itemized Deductions