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Standard mileage deduction rates for 2019

Dec 18, 2018

The Tax Cuts and Jobs Act (TCJA) has changed the landscape considerably when it comes to tax deductions for miles driven for business in your personal car, van or truck.    

In a nutshell, the deduction is gone for most taxpayers.

If you drive your personal vehicle for business and are not reimbursed for the mileage by your employer, the “miscellaneous itemized deduction” for such mileage was repealed by the TCJA for the tax years 2018 to 2025. If you are self-employed and your business-related mileage is incurred for your own business, the mileage is still deductible as a business expense.

The good news is that the standard mileage rate to be used for the mileage deduction in 2019 will be 58 cents per mile, up from 54.5 cents in 2018, the IRS recently announced.

Although the deduction is no longer available on the employees’ individual income tax return for employed individuals who drive personal vehicles on behalf of their employers, many businesses use the standard deduction rate set by the IRS as a guideline to determine reimbursement rates for work-related mileage.

The standard deduction for miles driven for medical care also will rise in 2019, to 20 cents per mile, up 2 cents from 2018.

The 20 cents-per-mile rate also applies to certain limited moving costs incurred by military members. The TCJA repealed the job-related moving expense deduction for individual taxpayers from 2018 to 2025, except for military members on active duty who move due to a military order.

The mileage rate for service to a charitable organization, which is set by statute, remains unchanged at 14 cents per mile.

The IRS bases the standard mileage rate on an annual study of the fixed and variable costs of operating an automobile.

If you have questions about deductibility of mileage, visit the IRS website.

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