IRS Guidelines For Car Mileage
The IRS allows for the deduction of certain types of transportation expenses on your taxes, when a car is used for business, medical, moving or charitable purposes. The IRS publishes specific guidelines for each of these types of transportation deductions. They also set standard mileage rates annually, and these can vary from year to year according to annual studies of the costs of operating an automobile.
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Business Mileage
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For 2010, the IRS directs that the standard mileage rate for operating a car for business use is 50 cents per mile. Their definition of car includes vans, pickups and panel trucks.
The IRS has a very specific definition of business-related transportation expenses. These include the cost of driving from one workplace to another in the course of your business, visits to clients or customers, attending business meetings away from your regular workplace or driving to a temporary workplace.
Keep in mind a few stipulations about deducting the standard mileage rate. If you deduct the standard mileage rate, you cannot deduct your actual car expenses in the same year. You must choose to use the standard mileage rate in the first year the car is used in your business. In later years, you can deduct either standard mileage or actual expenses. For a leased car, you must use the standard mileage rate for the entire lease period, if you opt to deduct it instead of actual expenses. You also must opt to choose the standard mileage rate by the due date of your return, which includes extensions. See IRS Publication 463 for further information about business-related car expenses.
Medical Mileage
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If you use your car for medical purposes, you can deduct the standard medical mileage rate, which in 2010 is set at 16.5 cents per mile. The IRS defines medical-related mileage expenses as transportation primarily for, and essential to, medical care. See Publication 521 for further details on allowable and disallowed medical transportation expenses. Allowable expenses include transportation of a child who requires medical care, of a nurse for a patient who is traveling to receive medical care and can't travel alone, regular visits to a mentally ill dependent when recommended for treatment, to and from Alcoholics Anonymous meetings if medically required and to a medical conference concerning your own chronic illness or that of a spouse or dependent.
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Moving Expenses
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If you use a car to transport yourself, your family or your personal effects to a new home related to the start of work, you can deduct either the actual transportation expenses or the standard mileage rate. The standard mileage rate for moving in 2010 is set at 16.5 cents per mile.
The IRS specifies very specific rules regarding distance and time for the eligibility of a work-related move. They also specify disallowed transportation expenses, including general repairs, maintenance, insurance and depreciation. See IRS Publication 521 for further information about deductible moving expenses.
Charitable Expenses
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You can claim and deduct expenses if you use your car to provide services to a qualified charitable organizations. In 2010, the standard mileage rate set by the IRS for charitable-related mileage expenses is 14 cents per mile.
The IRS is extremely strict about record-keeping for charitable mileage deductions. They stipulate that you must keep reliable written records of such expenses. Generally, your records are considered reliable if you recorded them regularly near the time the expenses were incurred. Your records must name the organization you were serving, the date of every use of your car and the actual miles you drove. Consult IRS Publication 526 for further information about charitable contributions.
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