On Monday, the IRS announced it is raising the automobile mileage rate that self employed individuals and business owners can claim on their tax returns. The agency said the standard rate it allows to calculate deductible operating costs for business vehicles will go up to 58.5 cents from the current 50.5 cents and will be available for use for the last six months of 2008.
Citing rising gas prices as having a major impact on individual and business finances, IRS Commissioner Doug Shulman said “given the increase in prices, the IRS is adjusting the standard mileage rates to better reflect the real cost of operating an automobile. He also said the agency wanted to get the new guidance early out so that businesses could prepare for doing mid-year adjustments beginning July 1st.
The deductible rate will also rise for computing deductible medical and moving expenses from 19 cents to 27 cents per mile for individuals not entitled to depreciation allowances.
As with everything that the IRS announces, you should consult with your accountant or tax advisor for advice as to how the new changes will affect your individual situation.
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3 users commented in " IRS Ups Automobile Mileage Writeoff "
Follow-up RSS Comments Feed or Leave a TrackbackThis is great news esp. with rising gas costs. I currently drive a SUV and appreciate every cent of savings, regardless where it comes from. I was about to trade in SUV for a car this past weekend, but now contemplating buying another SUV after new rates and incentives that were recently release to encourage those in the market to purchase automobile to “go suv” again.
For Example GM is currently offering 0% for 72 months for the next 72 hours on most trucks and SUV purchases.
Great news indeed! We need all the breaks that we can get. With oil going so high, I’m wondering what heating bills are going to look like this winter… could be harsh.
I agree, this is a good thing, especially for real estate agents. With the amount of driving we do with our clients, every little bit helps, and anytime you can write something off, you should take full advantage.
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