The Internal Revenue Service (IRS) has issued the 2019 standard mileage rates. Beginning on January 1, 2019, the standard mileage rates for the use of a car, van, pickup or panel truck will be:
- 58 cents per mile for business miles driven (up from 54.5 cents in 2018)
- 20 cents per mile driven for medical or moving purposes (up from 18 cents in 2018)
- 14 cents per mile driven in service of charitable organizations (currently fixed by Congress)
If you’re wondering about the difference in the rates for business and medical or moving purposes, there’s a reason: The standard mileage rate for business is calculated using an annual study of the fixed and variable costs of operating an automobile, including depreciation, insurance, repairs, tires, maintenance, gas and oil, while the rate for medical and moving purposes is based on the variable costs, such as gas and oil.
Standard mileage rates are used to calculate the amount of a deductible business, moving, medical or charitable expense (miles driven times the applicable rate). To use the rates, simply multiply the standard mileage rates by the number of miles traveled.
If you use your car for more than one use, you’ll want to keep appropriate records and back out the cost of personal travel. You may also use more than one rate on your tax return. Let’s say, for example, that you drive 20,000 miles in 2018. Of those miles, 10,000 are for personal use and 2,000 are for charitable purposes and 8,000 are for medical purposes. You would calculate your deduction as follows:
10,000 personal miles x 0 = 0
2,000 charitable miles x .14 = $280
8,000 medical miles* x .20 = $1,600
*For purposes of the example, I’m assuming that you’ve already hit the 10% floor for medical expenses.
In the example, your total deductible mileage related expenses would be $1,880 plus additional related charges such as parking fees and tolls.
Taxpayers also have the option of deducting actual expenses rather than using the standard mileage rates—though admittedly, that’s a lot more work.
Keep in mind that, under tax reform, taxpayers can no longer claim a miscellaneous itemized deduction for unreimbursed employee travel expenses. That deduction was eliminated from Schedule A alongside similar deductions like the home office deduction. You can see how those changes will affect Schedule A here. This does not affect any deductions that are properly claimed on a Schedule C for the self-employed, freelancers and independent contractors.
Most taxpayers cannot claim a deduction for moving expenses in 2019. However, an exception applies to members of the Armed Forces on active duty moving under orders to a permanent change of station.
(It’s worth noting that there was some confusion about moving expenses which occurred in 2017 but weren’t paid or reimbursed by the employer until 2018. The IRS issued guidance on this issue, and you can find out more here.)
Remember: These are the rates effective at the beginning of 2019 for the 2019 tax year. Assuming that they still apply to you, that means they’ll show up on your 2019 return (the one you’ll file in 2020).