The Internal Revenue Service announced the 2014 optional standard mileage rate for calculating the deductible costs of operating an automobile for business purposes. Starting January 1, 2014, the standard mileage rate for the business use of a car, van, pickup, or panel truck will be 56 cents per mile for business miles driven. This rate is a one-half cent per mile decrease from the rate in effect for 2013.
Taxpayers can choose between the standard mileage rate or the actual cost of operating their vehicle to calculate their deduction. However, there are some restrictions on using the standard mileage rate. For example, you cannot use the business standard mileage rate for a vehicle that you have claimed under Section 179 or depreciated using the Modified Accelerated Cost Recovery System (MACRS) because the vehicle’s depreciation is already factored into the standard mileage rate. You also cannot use the business standard mileage rate for more than four vehicles.
The IRS also announced the 2014 standard mileage rates for (1) vehicles driven for medical or moving purposes: 23.5 cents per mile; and (2) vehicles driven for charitable purposes: 14 cents per mile. See the IRS website (www.irs.gov) for more information.