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IRS mileage reimbursement rate
Old 09-12-2005, 01:23 PM   #1
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IRS mileage reimbursement rate

For those of us still working and getting reimbursed mileage from our employer, as of September 1, 2005, the IRS has increased the standard mileage rate from 40.5 cents a mile to 48.5 cents a mile.

Edit: IRS also raised the moving expense rate to 22 cents a mile, but since the rate for providing vehicle services to charitable organizations is set by law, it remains at 14 cents a mile.
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Re: IRS mileage reimbursement rate
Old 09-12-2005, 02:54 PM   #2
 
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Re: IRS mileage reimbursement rate

Wow, that's high.* How do you think it compares with the true cost to drive a car?

With the last car we had I did a comprehensive calculation of how much it cost per mile.* That calculation was in 2001, was based on buying it at $10,000 and selling it at $2,000, gas at $2/gallon (30 MPG), maintenance total (over 100,000 miles) $2,217, tires $1,027.

The result was .18 per mile.* The IRS rate in 2001 was 34.5 cents.
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Re: IRS mileage reimbursement rate
Old 09-12-2005, 03:01 PM   #3
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Re: IRS mileage reimbursement rate

Quote:
The result was .18 per mile
That is similar to what our agency determined for the costs of dodge neons a few years ago.
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Re: IRS mileage reimbursement rate
Old 09-12-2005, 03:04 PM   #4
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Re: IRS mileage reimbursement rate

Back when I used to deliver pizzas, a rough rule of thumb that I used was how close that mileage writeoff would come to paying for my gas. Now this was back before fuel prices shot up, so I was usually using cars that were fairly large and comfortable, but not too great on fuel economy. Stuff like a '68 Dart, '85 LeSabre, '89 Gran Fury copcar, and so on.

I think that, on average, figuring my tax bracket, the mileage writeoff usually netted me about 7-8 cents per mile. That just about covered the fuel. And in that kind of driving, fuel was definitely the single biggest factor in ownership of the car.

Nowadays, that 48.5 cents per mile would come out to around a net of 16.2 cents per mile. I figure if I still delivered pizzas, my aging 2000 Intrepid would get around 18 mpg. At $3.00 per gallon for gas, that's 16.7 cents per mile. So it would still just about cover it. Driving one of those older cars would kill me, though! The Gran Fury got 10-13 mpg, and had an appetite for hi-test!
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Re: IRS mileage reimbursement rate
Old 09-12-2005, 06:20 PM   #5
 
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Re: IRS mileage reimbursement rate

When I ran my calculation, fuel costs accounted for only 39% of the cost of operating the car. Most people forget that tires, oil, and engines get used up just like gas does.

I remember talking about this with a sax player at a gig. I told him that it cost me $12 to drive to and from the gig, when I figured depreciation, tires, fuel, etc.

"Oh, no, man, you can't figure it like that," he replied, "cause you gotta drive your car!"

Anyway, I watch this stuff closely because it's 25 miles to the closest town with a population over 300. For example, ten bucks if you want to take the videos back on time.
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Re: IRS mileage reimbursement rate
Old 09-12-2005, 06:39 PM   #6
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Re: IRS mileage reimbursement rate

Quote:
Originally Posted by Martha
For those of us still working and getting reimbursed mileage from our employer, as of September 1, 2005, the IRS has increased the standard mileage rate from 40.5 cents a mile to 48.5 cents a mile.
So two different rates for the same tax year? Is that a move to offset the current high gas prices or a permanent change? I assume that the same rates are valid for small businesses. I was going to itemize the car expenses, but I don't think I can beat this rate

Vicky
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Re: IRS mileage reimbursement rate
Old 09-12-2005, 07:34 PM   #7
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Re: IRS mileage reimbursement rate

Just figured I'd way in with my current driving costs. I drive a '96 Maxima, and from 90k miles (not including that checkup) to 120k miles (including that checkup), I spent $0.175 per mile. That includes DMV fees, gas, parking, repair and maintenance, and toll. It notably does not include insurance and depreciation. Adding in insurance it costs $0.277 per mile. Maybe it's time to shop for cheaper insurance. Or I could just drive more. :-)

Tim
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Re: IRS mileage reimbursement rate
Old 09-12-2005, 08:54 PM   #8
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Re: IRS mileage reimbursement rate

Quote:
Originally Posted by TromboneAl
For example, ten bucks if you want to take the videos back on time.
At that point I'd be thinking: "Netflix."
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Re: IRS mileage reimbursement rate
Old 09-17-2005, 10:00 PM   #9
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Re: IRS mileage reimbursement rate

It used to be that volunteers for the government could only use a standard mileage rate of $0.14 per mile. I remember reading about some legislation that was going to change that but don't know if it ever happened. Anyone know the details?
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Re: IRS mileage reimbursement rate
Old 09-18-2005, 12:25 AM   #10
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Re: IRS mileage reimbursement rate

Thank heavens for the adjustment! On my last consulting gig I rented a car because I could expense it and the gas on an actual cost basis when I could have driven my own vehicle.
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Re: IRS mileage reimbursement rate
Old 09-18-2005, 07:45 AM   #11
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Re: IRS mileage reimbursement rate

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Originally Posted by ((^+^)) SG
It used to be that volunteers for the government could only use a standard mileage rate of $0.14 per mile. I remember reading about some legislation that was going to change that but don't know if it ever happened. Anyone know the details?
Still 14 cents.
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