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IRS Increases Mileage Rate to 56.5 cent per mile

by | Dec 5, 2012 | Uncategorized

The 2013 standard mileage rates are set at 56.5 cents per mile for business transportation or travel, 24 cents per mile for medical care, and 14 cents per mile for charity purposes. The 2012 rates are 55.5 cents per mile for business transportation or travel, 23 cents per mile for medical care, and the rate for charity purposes stayed the same at 14 cents per mile. See IRS announcement…
The new rates will take effect on January 1, 2013.
These rates don’t necessarily reflect what a company has to pay their employees for these types of errands. However, employees and self-employed workers can use these numbers to calculate their approximate transportation costs and deduct them for tax purposes.
As always, taxpayers can choose to calculate the actual costs of using their vehicle for these purposes and deduct that amount rather than using the IRS’s standard mileage rates.
For businesses that reimburse their employees for transportation costs, rates can be lower than the IRS’s standard mileage rates, and then employees can simply deduct the difference.
The only way companies can pay their employees more than the standard rates is if the actual costs add up to more than those rates and the employee provides records of those costs. Additional items such as tolls and parking can be taken into account when calculating the actual cost of transportation.