The IRS issued the 2023 optional standard mileage rates used to calculate the deductible costs of operating an automobile for business, charitable, medical or moving purposes.
Beginning January 1, 2023, the standard mileage rates for the use of a car (including vans and pickups or panel trucks) are:
- 65.5 cents per mile driven for business use, up 3 cents from the midyear increase setting the rate for the second half of 2022.
- The business standard mileage rate cannot be used to claim an itemized deduction for unreimbursed employee travel expenses during the suspension.
- For automobiles a taxpayer uses for business purposes, the portion of the business standard mileage rate treated as depreciation is 28 cents per mile for 2023, up two cents from 2022.
- 22 cents per mile driven for medical or moving purposes for qualified active-duty members of the Armed Forces, consistent with the increased midyear rate set for the second half of 2022.
- 65.5 cents per mile driven for business use, up 3 cents from the midyear increase setting the rate for the second half of 2022.
- 14 cents per mile driven in service of charitable organizations; the rate is set by statute and remains unchanged from 2022.
These rates apply to electric and hybrid-electric automobiles, as well as gasoline and diesel-powered vehicles.
Update your record keeping now to track your mileage separately, before and after the rate change. It will save you time later when preparing your tax returns at the end of the year.
Dana R. Borys, an Accountancy Corporation is a boutique tax consulting, compliance, and representation firm working with affluent individuals and owners/officers/founders of start-up/emerging growth companies. Building connections beyond the code.