IRS Announces 2015 Standard Mileage Rates
The IRS has announced the 2015 standard mileage rates used to calculate the deductible costs of operating an automobile for business, charitable, medical and moving purposes. The 2015 rates are:
- 57.5 cents per mile for business miles driven, up from 56 cents in 2014. 22 cents of this amount is considered depreciation for basis reduction purposes.
- 23 cents per mile driven for medical or moving purposes, down half a cent from 2014
- 14 cents per mile driven in service of charitable organizations
Taxpayers always have the option of deducting actual costs of using an automobile rather than the standard rates, however, keep in mind the taxpayer cannot use the standard business mileage rates AND deduct actual costs of using an automobile, which includes both standard and accelerated depreciation amounts.
Most farmers use the standard mileage rates to reimburse employees for business miles that they may put on their personal vehicles. If you use these rates to reimburse those miles, the reimbursement will not be included in the employee’s income and it is 100% deductible by the business.
Paul Neiffer is a certified public accountant and business advisor specializing in income taxation, accounting services, and succession planning for farmers and agribusiness processors. Paul is a principal with CliftonLarsonAllen in Walla Walla, Washington, as well as a regular speaker at national conferences and contributor at agweb.com. Raised on a farm in central Washington, he has been immersed in the ag industry his entire life, including the last 30 years professionally. Paul and his wife purchase an 180 acre ranch in 2016 and enjoy keeping it full of animals.
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