A Quick Overview for 2024

The IRS has recently updated the standard mileage rates for 2024. It's important for businesses and individuals to stay informed. These rates affect anyone who uses a vehicle for business, medical, moving, or charity. Here’s what you need to know:

Business, Medical, Moving, and Charitable Rates:

• Business Mileage: The rate is now 67 cents per mile for those using cars, vans, or trucks for business. This is up from 65.5 cents a mile in 2023. This change helps employees who use personal vehicles for work-related travel. This rate takes into account variable costs like fuel, maintenance, and tires.

• Medical or Moving Mileage: The new rate is 21 cents per mile for those moving for certain reasons. This includes active duty in the Armed Forces or traveling for medical purposes. This change is down from the 2023 rate of 22 cents a mile. Yet, it still may provide some relief for members of the military and those with medical needs.

• Charitable Mileage: The rate remains 14 cents per mile for driving in service of charity. There was no change to this rate from 2023. This rate is set by statute and is used by volunteers who drive their own vehicles to help charities.

Depreciation Component:

The portion of the business standard mileage rate considered as depreciation is 30 cents per mile in 2024. This is up from 28 cents in 2023. Knowing this is important for businesses and self-employed individuals calculating their vehicle expenses for tax deductions.

Maximum Standard Vehicle Cost:

If you are using a Fixed and Variable Rate (FAVR) plan, the standard vehicle cost you can use in 2024 cannot exceed $62,000 for autos, trucks, or vans. This figure is important for those who use the FAVR method instead of the standard mileage rate.

What's Next?

These new rates are effective from January 1, 2024. They will impact budgeting and tax planning for individuals and businesses alike. Questions or concerns? Consult a tax professional or accountant, like the experts at Miller Verchota. We can explain how these changes specifically affect your tax situation and planning.

Stay ahead of the curve and navigate your tax planning with confidence!