IRS Increases Mileage Rates through Dec. 31, 2008

Posted by Bruce Mc on Jun 25, 2008 in Form 1040 Information, News Flash, Taxes | 0 comments

Well the IRS figured out that gas was too high. Below is a copy of the bulletin that they sent me (along with all the other practitioners that signed up for these).

What does this mean for you? Well if you are affected by the changes when you give your mileage to you preparer (or you are doing your own 2008 return) you will need the mileage form  01/01/2008 thru 06/30/2008 then the mileage from 07/01/2008 thru 12/31/2008. Something to be mind full of.

Oh I edited some of this so it would be easier on your eyes.

The Internal Revenue Service today announced an increase in the optional standard mileage rates for the final six months of 2008.

·         The rate will increase to 58.5 cents a mile for all business miles driven

o   from July 1, 2008, through Dec. 31, 2008.

§  This is an increase of eight {8} cents from the 50.5 cent rate in effect for the first six months of 2008, as set forth in Rev. Proc. 2007-70.

·         The new six-month rate for computing deductible medical or moving expenses will also increase by eight {8} cents to 27 cents a mile,

o   up from 19 cents for the first six months of 2008.

The rate for providing services for charitable organizations is set by statute, not the IRS, and remains at 14 cents a mile.

In recognition of recent gasoline price increases, the IRS made this special adjustment for the final months of 2008. “Rising gas prices are having a major impact on individual Americans. Given the increase in prices, the IRS is adjusting the standard mileage rates to better reflect the real cost of operating an automobile,” said IRS Commissioner Doug Shulman. “We want the reimbursement rate to be fair to taxpayers.”

Taxpayers always have the option of calculating the actual costs of using their vehicle rather than using the standard mileage rates.

Mileage Rate Changes

The new rates are contained in Announcement 2008-63 on the optional standard mileage rates.