The Internal Revenue Service today announced 2024 optional standard mileage rates for calculating deductible expenses when operating a motor vehicle for business, charitable, medical, or transportation purposes. The most notable change is the slight increase in his per mile of enterprise.
Effective January 1, 2024, the optional standard mileage rates for motor vehicle (also van, pickup, and panel truck use) use will be as follows:
- Business mileage costs 67 cents per mile. This is a slight increase from his 2023 percentage.
- In 2024, the rate for medical or transportation purposes will be 21 cents per mile.
- The cost per mile driven in service to charities will remain unchanged at 14 cents starting in 2023.
These charges apply to electric and hybrid electric vehicles, gasoline and diesel vehicles.
Standard mileage rates for business use are calculated by examining the fixed and variable costs of operating a vehicle each year. Fees for medical and moving purposes are based on variable costs.
These mileage rates apply only to expenses incurred or paid by the taxpayer after January 1, 2024 (and if reimbursed by the employer after that date). Expenses incurred before January 1, 2024 (whether or not reimbursed by the employer before or after that date) continue to be subject to the 2023 median markup rate (65.5 cents for business transportation and 65.5 cents for medical transportation). 22 cents) will apply.
This mileage fee increase pertains to employers who reimburse employees for travel expenses based on mileage. Although there is no legal requirement to reimburse an employee at her standard IRS tax rate, many employers have a policy of doing so. Payments to an employee based on business travel that exceed the IRS standard tax rate generally constitute taxable income to the employee.
