The 2011 optional standard mileage rates used to calculate the deductible costs of operating an automobile for business, charitable, medical, or moving purposes have been issued by the Internal Revenue Service (IRS).
The standard mileage rates for the use of a car (also vans, pickups or panel trucks) effective January 1, 2011, will be:
The standard mileage rate for business 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 as determined by the same study. An independent contractor conducted the study.
If a taxpayer is using any depreciation method under the Modified Accelerated Cost Recovery System (MACRS) or claiming a Section 179 deduction for that vehicle, the business standard mileage rate cannot be used. In addition, the business standard mileage rate cannot be used for any vehicle used for hire or for more than four vehicles used simultaneously.
The option of calculating the actual costs of using their vehicle is always available to taxpayers who prefer not to use the standard mileage rates.