Business Mileage Rates
So now that we are well into 2014, its time to talk mileage (business and otherwise). As of January 1, 2014 the IRS set the standard deductible business mileage rate at 56¢ per mile (down from 56.5¢ in 2013). If you travel on business, it’s very important to document your mileage including the business purpose of your trip. If you don’t provide this information in an audit, the IRS is likely to throw out your deduction. Back in 2012 we provided this sample Mileage Log with Reimbursement Form . Keep it in the car you’ll be traveling in and it’ll make tracking your mileage a breeze.
Instead of using the standard mileage rate you can opt to deduct your actual expenses. To do so make sure you keep all receipts related to gas, oil, repairs, tires, and insurance. You may also take a deduction for depreciation using this method. Tracking this method can be a lot of work though. Many of our clients present us with both their business mileage and actual expenses when we get ready to prepare their tax return and often using the mileage rate provides the larger deduction. Also keep in mind that if you use your car for both business and personal use, only the business portion is deductible.
Other Standard Rates
For 2014, the IRS set mileage rates for medical travel and rates for mileage in connection with a move at 23.5¢ a mile (also down .5¢ from 2013). The standard mileage rate for charitable purposes was not adjusted by the IRS and remains 14¢ per mile.
Stephen Osborne, CPA