![]() Instead of deducting your actual expenses, you may be able to use a standard cents-per-mile rate. ![]() Note that your deduction may be subject to so-called “luxury car” limits, indexed annually.īut many taxpayers don’t want to keep track of all their vehicle-related expenses. In addition, you may claim a depreciation allowance for the vehicle, based on the percentage of business use. This includes expenses such as gas, oil, tires, insurance, repairs, licenses and vehicle registration fees. If you use a vehicle for business driving, you generally have the option to deduct the actual expenses attributable to your business use. There are two options for deducting business driving expenses. “We are aware a number of unusual factors have come into play involving fuel costs, and we are taking this special step to help taxpayers, businesses and others who use this rate.” Basic business driving deduction rules “The IRS is adjusting the standard mileage rates to better reflect the recent increase in fuel prices,” said IRS Commissioner Charles Rettig. The IRS also announced an increased standard mileage rate for medical driving and moving for members of the military. This is compared with $3.08 a gallon a year ago.īeginning July 1, 2022, the standard mileage rate for business travel will be 62.5 cents per mile, up 4 cents from the 58.5 cents-per-mile rate effective for the first six months of the year. In fact, as of June 13, the nationwide average price of regular unleaded gas was $5.01 a gallon, according to the AAA Gas Prices website. The adjustment reflects the soaring cost of gasoline this year. The IRS recently announced that it’ll increase the standard mileage rate for qualified business driving for the second half of 2022.
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