News Details
Standard mileage rates for business, medical & moving increase 1¢ per mile for 2013
Notice 2012-72, 2012-50 IRB; IR 2012-95
Standard mileage rates for 2013.Notice 2012-72 provides that the standard mileage rate for transportation or travel expenses is 56.5¢ per mile for all miles of business use (business standard mileage rate). The standard mileage rate is 24¢ per mile for use of an auto (1) for medical care described in Code Sec. 213; or (2) as part of a move for which the expenses are deductible under Code Sec. 217. The standard mileage rate is 14¢ per mile for use of an auto in rendering gratuitous services to a charitable organization under Code Sec. 170. (Notice 2012-72, Sec. 2)
As Notice 2012-72 notes, taxpayers using the standard mileage rates must comply with Rev Proc 2010-51. Accordingly, the standard mileage rate may not be used for a purchased auto if:
- It was previously depreciated using a method other than straight-line for its estimated useful life;
- A Code Sec. 179 expensing deduction was claimed for the auto;
- The taxpayer has claimed the additional first-year depreciation allowance;
- The taxpayer depreciated it using MACRS under Code Sec. 168; or
- The taxpayer is a rural mail carriers who receive qualified reimbursements. (Rev Proc 2010-51)
A taxpayer who uses the mileage allowance method for an auto he owns may switch in a later year to deducting the business-connected portion of actual expenses, so long as he depreciates it from that point on using straight-line depreciation over the auto's remaining life. The depreciation deductions would still be subject to the Code Sec. 280F dollar caps. (Rev Proc 2010-51, Sec. 4.05(3))
Depreciation. For 2013, Notice 2012-72, Sec. 3, provides that the depreciation component of the mileage rate for autos used by the taxpayer for business purposes is 23¢ per mile. (It was 23¢ per mile for 2012; 22¢ for 2011; 23¢ for 2010; and 19¢ per mile for 2009) The depreciation component reduces the basis of the auto for gain or loss purposes. (Rev Proc 2010-51, Sec. 4.04)
When the new rates are effective. The revised standard mileage rates in Notice 2012-72 (56.5¢ for business; 24¢ for medical or moving) apply to deductible transportation expenses paid or incurred for business, medical, or moving expense purposes on or after Jan. 1, 2013, and to mileage allowances or reimbursements that are paid to an employee or charitable volunteer (1) on or after Jan. 1, 2013, and (2) for transportation expenses paid or incurred by the employee or charitable volunteer on or after Jan. 1, 2013.
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