Understanding the New Mileage Rates

Did you hear? The IRS raised the mileage rates over the summer. As if you needed more an incentive to keep up your business mileage, the rate is now 55.5 cents per mile until December 31, 2011. If you work in the Chicago real estate industry and find yourself constantly driving from community to community, the extra money can add up quickly.
Equifax Finance Blog tax specialist Eva Rosenberg explains the new rates in her article, ”
2012 Standard Mileage Rate: How It Affects Your Business Vehicle.” Those looking for a few
tax tips should definitely read the full post. Here are some of the highlights:
The rate for moving and medical mileage increase to 23.5 cents per mile from 19 cents. Charitable mileage stays the same, at 14 cents.
Using your car for business expenses or work has its benefits. You can use either the
standard mileage deduction or you may use actual expenses to lower your taxes. If you use your actual expenses, you are allowed to claim depreciation deductions as well as insurance, registration fees, repairs and fuel costs.
According to Rosenberg, many people are unaware that the standard mileage rate has built-in depreciation. She suggests using the table on the Small Business Taxes & Management site to determine your depreciation per year.
To read Rosenberg’s full article and receive all of her in-depth knowledge, visit the Equifax Finance Blog.