The IRS announced the optional standard mileage rates for 2024, which calculate the deductible costs of operating your car, truck, or van for various purposes such as business, charity, medical, or moving. These rates will take effect from January 1, 2024, and here's what you need to know:
- For business use, the rate will be 67 cents per mile driven, up by 1.5 cents from 2023.
- For medical or moving purposes, the rate will be 21 cents per mile driven for qualified active-duty Armed Forces, a decrease of 1 cent from 2023.
- For service of charitable organizations, the rate remains unchanged at 14 cents per mile
driven.
It's important to note that you cannot claim a miscellaneous itemized deduction for unreimbursed employee travel expenses or moving expenses (unless you are a member of the Armed Forces on active duty moving under orders to a permanent change of station) due to the Tax Cuts and Jobs Act.
You can either use the standard mileage rate or calculate the actual costs of using your vehicle. If you choose to use the standard mileage rate, you generally must opt to use it in the first year the car is available for business use. In later years, you can choose either the standard mileage rate or actual expenses. If you lease a vehicle and choose the standard mileage rate, you must use this method for the entire lease period (including renewals).
It's worth mentioning that these rates apply to electric, hybrid-electric, gasoline, and diesel-powered vehicles.