2021 Standard Mileage Rates Announced

2021 news 4The Internal Revenue Service has issued the 2021 optional standard mileage rates used to calculate the deductible costs of operating an automobile for business, charitable, medical, or moving purposes. As of Jan. 1, 2021, the standard mileage rates for the use of a vehicle are:

  • 56 cents for every mile of business travel driven (down 1.5 cents from 2020);
  • 16 cents per mile for medical or moving purposes (down 1 cent from 2020); and
  • 14 cents per mile driven in service of charitable organizations (the same as in 2020).

The standard mileage rate for business is based on an annual study of the fixed and variable costs of operating an automobile. The rate for medical and moving purposes is based on the variable costs.

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

To learn more about deducting mileage costs, read Memo #11 – Auto and Other Business Expense Reimbursements.