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Jun 25

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IRS announces mid-year change in mileage reimbursement rates

In Announcement 2011-40, the Internal Revenue Service (IRS) announced an increase in the optional standard mileage rates for the final six months of 2011. The mileage reimbursement rate will increase to 55.5 cents a mile for all business miles driven from July 1, 2011, through December 31, 2011.  This is an increase of 4.5 cents from the 51 cent rate in effect for the first six months of 2011.

Deductions for automobile usage involving medical and moving deductions were increased to 23.5 cents per mile.  The mileage rate that applies to the deduction for charitable contributions is fixed under § 170(i) of the Internal Revenue Code at 14 cents per mile, and so was not changed.

The IRS made this special adjustment for the final months of 2011 in recognition of recent gasoline price increases. The IRS normally updates the mileage rates once a year in the fall for the next calendar year.

As before, taxpayers have the option of calculating the actual costs of using their vehicle rather than using the standard mileage rates.

About the author

David Nolte

I am a founding principal of Fulcrum Inquiry, an accounting and economic consulting firm that performs damage analysis for commercial litigation, forensic accountings, financial investigations, and business valuations. I am a Certified Public Accountant (CPA) and an Accredited Senior Appraiser (ASA), as well as having other professional credentials. I regularly serve as an expert witness involving damages measurement. My litigation-oriented resume is on Fulcrum's website.

Permanent link to this article: http://betweenthenumbers.net/2011/06/irs-announces-mid-year-change-in-mileage-reimbursement-rates/

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