Standard Mileage Rates 2011 – Change on July 1, 2011

(*)Updated for http://www.irs.gov/pub/irs-drop/a-11-40.pdf

Beginning on Jan. 1, 2011, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) will be:

• 51 cents per mile for business miles driven; beginning July 1= 55.5 cents
• 19 cents per mile driven for medical or moving; to 23.5 cents July 1
• 14 cents per mile driven in service of charitable organizations.

(*)The rate will increase to 55.5 cents a mile for all business miles driven from July 1, 2011, through Dec. 31, 2011.

This is an increase of 4.5 cents from the 51 cent rate in effect for the first six months of 2011, as originally set forth in Revenue Procedure 2010-51.

A taxpayer may not use the business standard mileage rate for a vehicle after using any depreciation method under the Modified Accelerated Cost Recovery System (MACRS) or after claiming a Section 179 deduction for that vehicle.

In addition, the business standard mileage rate cannot be used for more than four vehicles used simultaneously.

Beginning in 2011, a taxpayer may use the business standard mileage rate for vehicles used for hire, such as taxicabs. Also beginning in 2011, the standard mileage rates are announced in a separate notice, which also provides the amount a taxpayer must use in calculating reductions to basis for depreciation taken under the business standard mileage rate and the maximum standard automobile cost for automobiles under a FAVR allowance. The IRS plans to discontinue publishing the standard mileage rate revenue procedure annually but will publish modifications as required. Taxpayers always have the option of calculating the actual costs of using their vehicle rather than using the standard mileage rates.