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Taxes

The 2024 IRS Mileage Rates

Amanda Bevilacqua

The IRS has updated the standard mileage deduction rates for 2024. These rates play a crucial role in calculating your mileage deductions or setting the reimbursement rate for business-related driving with your personal vehicle. The 2024 IRS mileage rates are:

  • 67 cents per mile for business-related driving.
  • 21 cents per mile for moving and medical purposes.
  • 14 cents per mile for miles in the service of charitable organizations.

Understanding the IRS Mileage Rate 2024

IRS mileage rates are based on an annual study of the costs of operating an automobile. It includes all fixed and variable costs related to the ownership and operation of the vehicle including:

  • Fuel costs
  • Vehicle maintenance and repair costs
  • Used car prices
  • Insurance premiums
  • License and registration fees

Gas prices are weighted heavily in their calculation. With an increase in average national gas prices this year, an increase in mileage rate to 67 cents per mile makes sense. The 2024 IRS mileage rate will be effective from January 1, 2024.

How has the standard mileage rate changed over time?

The standard mileage rate is revisited each year by the Internal Revenue Service. The prior rates include:

2023: 65.5 cents per mile

2022: 58.5 cents per mile for the first six months of the year, 62.5 cents for the remaining six months.

2021: 56 cents per mile

2020: 57.5 cents per mile

2019: 58 cents per mile

2018: 54.5 cents per mile

When to use the current IRS mileage rate?

Using the standard mileage rate is a simple way of calculating mileage for your tax return. If you are self-employed and using your personal vehicle for business purposes, utilizing the new mileage rate will maximize your tax deductions. IRS approved mileage includes:

  • Trips to job sites
  • Meetings with customers
  • Business-related errands
  • Transportation to and from an airport for business trips
  • Generally any driving for business purposes

As an employer, using the IRS standard mileage rate to reimburse your employees for their business mileage streamlines administrative tasks. Employers establish the rate and rules for reimbursement, while the IRS's standard mileage rates act as the upper limit for what can be deducted for tax purposes.

Strategies for Maximizing Your Mileage Deduction

After understanding the IRS mileage rate, it's time to maximize your mileage deductions in 2024. Making the most out of every mile means knowing exactly how far you are driving for work. Tracking all your mileage is important so you never miss a mile and provide evidence for your deduction in the event of an audit.

Here are some ways to track mileage to that qualify for tax deductions, including:

  • Using a mileage tracker app like MileIQ
  • Using a paper mileage notebook
  • Using a computer-based spreadsheet
  • Using a specialized mileage tracking tool

No matter the method, it’s important to keep a detailed record documenting the date, purpose, and distance of each business-related trip.

Download MileIQ to start tracking your drives

Automatic, accurate mileage reports.

Leveraging Technology for Accurate Tracking

Technology or Mileage Apps can be helpful tool in keeping accurate mileage records. Using GPS tracking and other location data, mileage tracking technology captures and documents the distance covered. An automatic mileage app like MileIQ makes this easy.

GPS-based trackers are accurate in measuring distances for both business and medical and moving purposes. They eliminate the possibility of human error in manually logging miles, and provide accurate insights into the distance traveled.

In choosing a mileage tracking app for IRS deductions, look for features such as:

  • Accurate and automatic mileage tracking
  • Simple classification
  • Automatic reports for easy management and claiming of deductions
  • The ability to track, store, and finalize data effortlessly for accurate IRS tax audits

Choosing Between Standard Mileage and Actual Expenses

Taxpayers can choose between the standard mileage rate method and the actual expense method to calculate mileage tax deductions. The standard mileage rate method provides simplicity and a fixed rate. However, individuals with higher mileage may find the actual expenses method more advantageous.

Under the actual expense method, you can deduct expenses like:

  • Depreciation
  • Licenses
  • Lease payments
  • Registration fees
  • Gas and oil
  • Insurance
  • Repairs
  • Garage rent
  • Tires
  • Tolls
  • Parking fees

While this method allows you to deduct the actual costs of using your car for business purposes, it requires more record keeping and documentation. Despite the potential for a larger tax deduction, it may not always result in a higher deduction if your car has low depreciation or if you have high business mileage.

Comprehending these strategies and selecting the most advantageous one based on your mileage can greatly affect your tax deductions.

Download MileIQ to start tracking your drives

Automatic, accurate mileage reports.

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