IRS Adjusts Standard Mileage Rates for 2024
The figures are used to calculate deductible costs of driving for business, charitable, medical or moving purposes.
The Internal Revenue Service said Thursday that the optional standard mileage rate for business use will increase to 67 cents a mile in 2024, up 1.5 cents from 2023.
Standard mileage rates are used to calculate the deductible costs of operating an automobile for business, charitable, medical or moving purposes.
Come Jan. 1, the rates for the use of a car (also vans, pickups or panel trucks) will also be:
- 21 cents per mile driven for medical or moving purposes for qualified active-duty members of the U.S. armed forces, a decrease of 1 cent from 2023; and
- 14 cents per mile driven in service of charitable organizations; the rate is set by statute and remains unchanged from 2023.
The rates apply to electric and hybrid-electric automobiles as well as gasoline and diesel-powered vehicles.
Under the Tax Cuts and Jobs Act, “taxpayers cannot claim a miscellaneous itemized deduction for unreimbursed employee travel expenses,” the IRS states in Notice 2024-08.
Taxpayers, the IRS states, “also cannot claim a deduction for moving expenses, unless they are members of the Armed Forces on active duty moving under orders to a permanent change of station. For more details see Moving Expenses for Members of the Armed Forces.”
The standard mileage rate for business use is based on an annual study of the fixed and variable costs of operating an automobile, according to the IRS, and the rate for medical and moving purposes is based on the variable costs.
Notice 2024-08 contains the optional 2024 standard mileage rates, as well as the maximum automobile cost used to calculate the allowance under a fixed and variable rate plan, the IRS explains.
The notice also “provides the maximum fair market value of employer-provided automobiles first made available to employees for personal use in calendar year 2024 for which employers may use the fleet-average valuation rule in or the vehicle cents-per-mile valuation rule,” the IRS states.
“Taxpayers always have the option of calculating the actual costs of using their vehicle rather than using the standard mileage rates,” the notice states.
Taxpayers can use the standard mileage rate but generally must opt to use it in the first year the car is available for business use, the IRS said. Then, in later years, they can choose either the standard mileage rate or actual expenses.
Leased vehicles must use the standard mileage rate method for the entire lease period (including renewals) if the standard mileage rate is chosen.