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Standard Mileage Rate 2014

Standard Mileage Rate 2014

You are generally entitled to deduct vehicle expenses for your business. You can use either the actual expense amount, or an amount computed using the standard mileage rate, whichever is greater. The standard mileage rate is important to the small business owner because it can be a significant deduction.

The Internal Revenue Service recently issued the standard mileage rates 2014. The standard mileage rate is optional and is used to calculate the deductible costs of operating an automobile for business, charitable, medical or moving purposes. The business mileage reimbursement rate is also used by some employers for computing employee reimbursement amounts when an employee operates an employee-owned automobile for the employer’s business purposes.

Beginning on Jan. 1, 2014

The standard mileage rates for the use of a car (also vans, pickups or panel trucks) will be:

  • 56 cents per mile for business miles driven
  • 23.5 cents per mile driven for medical or moving purposes
  • 14 cents per mile driven in service of charitable organizations

The standard mileage rate for business is based on an annual study of the fixed and variable costs of operating an automobile. Taxpayers always have the option of calculating the actual costs of using their vehicle rather than using the standard mileage rates.

Standard mileage rate rules

There are some rules limiting when you can use the standard business mileage rates:

  • You can claim the standard mileage rate for a maximum of four vehicles used simultaneously.
  • You cannot use the standard mileage rate if you’ve already claimed a Section 179 deduction for that vehicle.
  • And you cannot use the standard business mileage rate for a vehicle after using any depreciation method under the Modified Accelerated Cost Recovery System (MACRS).

For more information, see Notice 2013-80, which contains the standard mileage rates, the amount taxpayers must use to calculate reductions to basis for depreciation taken under the business standard mileage rate, and the maximum standard automobile cost taxpayers may use to calculate the allowance under a fixed and variable rate plan.

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