IRS Raises Mileage Rate to 48.5 Cents
Wednesday, November 01, 2006
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WASHINGTON — The Internal Revenue Service, reflecting rising fuel and vehicle costs, is raising the standard mileage rate used to calculate the deductible costs of driving for business purposes.
The agency said Wednesday that as of Jan. 1, 2007, the new rate will be 48.5 cents per mile for business miles driven.
That is the same as the 48.5 cent rate temporarily imposed during the final months of 2005 when gas prices spiked in the wake of Hurricane Katrina. During 2006 the rate was 44.5 cents per mile.
The rate for figuring deductible medical or moving expenses in 2007 will be 20 cents per mile, up from 18 cents in 2006.
The rate for people deducting travel costs related to charitable service, which is set by Congress, will be unchanged at 14 cents per mile.
The IRS said the standard mileage rates for business, medical and moving purposes are based on an annual study of the fixed and variable costs of operating a vehicle, including purchases prices and fuel costs.
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