Tax and Money Tip of the Week:
IRS Announces 2014 Mileage Rates
January 15, 2014 | No. 170
The 2014 standard mileage rates used to calculate the deductible costs of operating an automobile for business, charitable, medical or moving purposes are:
-56 cents per mile for business purposes
-23.5 cents per mile for medical or moving purposes
-14 cents per mile driven in service of charitable organizations
The rate for business, medical and moving expense rates decrease one-half cent from the 2013 rates. The charitable mileage rate is set by statute.
The IRS determines the mileage rates based on an annual study of the costs of operating an automobile, including fuel prices, repair and maintenance costs, registration, etc.
Taxpayers always have the option of calculating the actual costs of using their vehicles rather than using the standard mileage rates.
However, you cannot use the standard mileage rates for business if you made the election to take a deprecation deduction in the year you placed the vehicle in service.
Regardless of which method you choose to deduct vehicle expenses, the IRS requires that you keep contemporaneous records to substantiate your deductions, like a mileage log. A properly maintained mileage log will contain such details as date and time, name and location of the destination and the purpose of the trip.
Stay safe while driving in 2014—and keep track of those miles!
Questions or Comments?
Mark Vitek, CPA/PFS, CFP®
…until next week.