The Internal Revenue Service on Thursday issued the optional standard mileage rates used to calculate the deductible costs of operating an automobile for business, charitable, medical or moving purposes.
Beginning on Jan. 1, 2024, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) will be:
- 67 cents per mile driven for business use, up 1.5 cents from 2023.
- 21 cents per mile driven for medical or moving purposes for qualified active-duty members of the Armed Forces, a decrease of 1 cent from 2023.
- 14 cents per mile driven in service of charitable organizations; the rate is set by statute and remains unchanged from 2023.
Those who own a business, or are self-employed and use their vehicle for business, may deduct the business use of a vehicle on their income tax return. However, the 2017 Tax Cuts and Jobs Act no longer allows employees to deduct unreimbursed business mileage unless they are active-duty military. The business travel deduction for non-military employees remains suspended until Jan. 1, 2026.
However, some employers also use the IRS’s optional standard mileage rate to pay tax-free reimbursements to employees who use their own personal vehicles for business travel.
Notice 2024-08 contains the optional 2024 standard mileage rates. In addition, the notice provides the maximum fair market value of employer-provided automobiles first made available to employees for personal use in calendar year 2024 for which employers may use the fleet-average valuation rule in or the vehicle cents-per-mile valuation rule.
The 2024 standard mileage rates apply to electric and hybrid-electric automobiles, as well as gasoline and diesel-powered vehicles.
The standard mileage rate for business use is based on an annual study of the fixed and variable costs of operating an automobile. The rate for medical and moving purposes is based on the variable costs.
