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Compliance December 3, 2009
IRS Standard Mileage Rate for Business Decreases for 2010
December 3, 2009 (PLANSPONSOR.com) - The Internal Revenue Service has issued the 2010 optional standard mileage rates used to calculate the deductible costs of operating an automobile for business, charitable, medical or moving purposes.
Reported by Rebecca Moore
Beginning on January 1, 2010, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) will be:
- 50 cents per mile for business miles driven,
- 16.5 cents per mile driven for medical or moving purposes, and
- 14 cents per mile driven in service of charitable organizations.
The new rates for business, medical and moving purposes
are slightly lower than last year’s to reflect generally lower transportation
costs compared to a year ago, the IRS said.
The standard mileage rate for business is based on an
annual study of the fixed and variable costs of operating an automobile. The
rate for medical and moving purposes is based on the variable costs as
determined by the same study, conducted by independent contractor Runzheimer
International.
The IRS reminded taxpayers that they may not use the
business standard mileage rate for a vehicle after using any depreciation
method under the Modified Accelerated Cost Recovery System (MACRS) or after
claiming a Section 179 deduction for that vehicle. In addition, the business
standard mileage rate cannot be used for any vehicle used for hire or for more
than four vehicles used simultaneously.
Taxpayers always have the option of calculating the
actual costs of using their vehicle rather than using the standard mileage
rates.