Beginning Jan. 1, 2016, the standard mileage rates for use of an automobile¬†will be:
54 cents per mile for business miles driven, down from 57.3 cents
19 cents per mile driven in medical or moving purposes, down from 23 cents
14 cents per mile driven in service of charitable organizations, which remains unchanged from 2015
For purposes of computing the allowance under a fixed and variable rate (FAVR) plan, the standard automobile cost may not exceed $28,000 ($31,000 for trucks and vans).
The updated rates are effective for deductible transportation expenses paid or incurred on or after the effective date;¬†and for mileage allowances or reimbursements paid to, or transportation expenses paid or incurred by, an employee or a charitable volunteer on or after Jan. 1, 2016.
If you have questions regarding how to account for the changes to the¬†2016 standard mileage rates, contact Doeren Mayhew tax advisors.