2024 IRS Mileage reimbursement rate: Starting a business involves spending money, and that’s where business deductions become super helpful during tax time. One big cost for some businesses is travel, which can get pricey when it’s a regular part of the job. To help out, the IRS has something called a mileage rate deduction. It’s like a way of giving back to business owners and contractors for the time and money they spend traveling.
If you’re a business owner or a contractor, you can figure out how much you can save on taxes for driving specifically for work by checking out the IRS mileage rate deduction. More info about 2024 IRS Mileage reimbursement rate, Everything you should know about the 1.5 cents increase.
In 2024, the fee has hit its all-time high at 67 CPM, which is 1.5 cents more than the 2023 rate of 65.5 CPM. For the latest IRS Mileage Reimbursement Rate 2024, check this page. The IRS has increased the business mileage rate for 2024, making it the fourth rise in the last three years. This information will help you adjust the rate according to your company’s requirements. More info about 2024 IRS Mileage reimbursement rate, Everything you should know about the 1.5 cents increase.
2024 IRS Mileage reimbursement rate
Understanding IRS Mileage Rates
According to the latest update on the IRS Standard Mileage Rate 2024, the business mileage rate (BMR) has gone up by 1.5 cents from 2023 to 67 CPM in 2024. There are two more mileage rates: the charitable mileage rate remains at $0.14 per mile, and the rate for moving and medical expenses is now $.21 per mile, a decrease of 1 cent. It’s important not to mix up these additional rates with the business mileage rate.
These standard rates are mainly meant for businesses and individuals to calculate the value of using a vehicle for tax purposes. In simpler terms, these rates are tools for tax deductions. However, many businesses use the business rate as their usual way of reimbursing employees. More info about 2024 IRS Mileage reimbursement rate, Everything you should know about the 1.5 cents increase.
2024 IRS Mileage reimbursement rate details
| Post Title | IRS Mileage Reimbursement Rate 2024 |
| Country | USA |
| Purpose | Tax help for vehicles |
| New Rates | 67 CPM |
| Category | Finance News |
| New Rates Applicable Date | January 1, 2024 |
| Official Website | irs.gov |
What’s the Standard Mileage Rate?
The Internal Revenue Service (IRS) sets a default cost per mile (CPM) for taxpayers who want to claim deductions for using their cars for business, charity, or medical purposes. This rate is often called the standard mileage rate, mileage per diem, or deductible mileage. The IRS updates these rates each year, and they differ depending on whether the car is used for business, charity, or medical reasons. In 2022, due to increasing fuel prices, there was a change in the middle of the year. More info about 2024 IRS Mileage reimbursement rate, Everything you should know about the 1.5 cents increase.
- The mileage rate for business use is 65.5 cents per mile for the 2023 tax year.
- The standard mileage charge is 67 CPM for the 2024 tax year.
BSM Rate Increases to 67 Cents in 2024
The IRS has set the standard mileage rate for business travel at 67 cents per business mile in 2024. This is a 1.5 cent increase from the 2023 rate of 65.5 CPM. It applies to all typical vehicles—cars, vans, pickups, or panel trucks—using electricity, hybrid systems, gasoline, or diesel.
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Also, the IRS has reduced the standard mileage rate for moving or medical miles driven to 21 CPM, which is 1 cent less than 2023. Congress has set the rate for miles driven for charity work at 14 CPM, and it will stay the same through 2024. The IRS Standard Mileage Rate Adjustment (SMRA) is influenced by the significant costs of owning a car in the US. This includes the consistently high expenses of car ownership and maintenance, ongoing international conflicts, and ongoing challenges with labor shortages and supply chains. More info about 2024 IRS Mileage reimbursement rate, Everything you should know about the 1.5 cents increase.
IRS mileage rates 2024
Knowing the IRS standard mileage rate is crucial for those managing or doing work-related driving. For self-employed individuals like gig workers or rideshare drivers, deducting car expenses from taxes can lead to significant savings. The IRS mileage rate for 2024 becomes a crucial benchmark for setting reimbursement rates for both businesses and workers.
| Federal mileage rates | 2024 | 2023 |
|---|---|---|
| Business use (cars, vans, pickups, panel trucks) | 67 CPM | 65.5 CPM |
| Medical and moving (Armed Forces active-duty only) | 21 CPM | 22 CPM |
| Charity | 14 CPM | 14 CPM |
Using IRS Standard Mileage Rate for Business
If you’re self-employed or a contractor, you might be able to deduct the expense of using your car for work-related travel. The deduction depends on how you use your car, with certain exceptions. You can choose to deduct real expenses like parking fees, maintenance, and fuel, or go with the standard mileage rate mentioned above. Remember, you can’t deduct both.
