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mileage rate The IRS has issued the 2020 standard mileage rates used to calculate the deductible costs of operating an automobile for business, charitable, medical, or moving purposes. Beginning Jan. 1, 2020, the standard mileage rates for the use of a vehicle became:

  • 57.5¢ for every mile of business travel driven, (down from 58¢ in 2019);
  • 17¢ per mile for medical or moving purposes, (down from 20¢ in 2019); and
  • 14¢ cents per mile driven in service of charitable organizations (fixed by Congress).

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

Note that under the Tax Cuts and Jobs Act of 2017, taxpayers cannot claim a miscellaneous itemized deduction for unreimbursed employee travel expenses. For this reason, ministers should use an accountable reimbursement plan. To learn more, read Memo #11 – Auto and Other Business Expense Reimbursements.

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