If you’ve driven anywhere for work, you may have thought about how much money you can declare on your taxes for mileage.
Last month, the Internal Revenue Service announced optional standard mileage rate deductions for the 2017 tax season. The deductions go far beyond work-related travels.
The IRS notes that if you’ve been operating a car for business, charitable, medical or moving purposes, you can deduct that mileage from your taxes. It’s also not just limited to cars — vans, pickup trucks and panel trucks are also eligible.
This year, the rates are:
- 53.5 cents per mile for business miles driven, down from 54 cents for 2016
- 17 cents per mile driven for medical or moving purposes, down from 19 cents for 2016
- 14 cents per mile driven in service of charitable organizations
Notable changes from last year to this year include a half-cent per mile drop for business mileage and a two-cent drop for medical and moving expense rates. The charitable rate stayed the same. So how was the change decided on?
“The standard mileage rate for business is based on an annual study of the fixed and variable costs of operating an automobile,” per the IRS website. “The rate for medical and moving purposes is based on the variable costs.”
Are you planning on using mileage deductions on your taxes? Keep in mind that you can’t use the business standard mileage rate for a vehicle “after using any depreciation method under the Modified Accelerated Cost Recovery System (MACRS) or after claiming a Section 179 deduction for that vehicle,” the IRS says.
See the full notice on the IRS website, which includes not only the standard mileage rates, but also how to calculate reductions on your mileage and the maximum standard automobile cost that you can use in calculating your rate plan for mileage.