Standard Milage Rate Raises Starting July 2022

An announcement made by the International Revenue Service informs taxpayers that the optional standard mileage rates for computing the deductible costs of operating an automobile for business, medical, or moving expense purposes have been revised as a result of recent increases in the price of fuel. The standard mileage rates set at the beginning of the year continue to apply to deductible transportation expenses paid or incurred before July 1, 2022.

"We are aware a number of unusual factors have come into play involving fuel costs, and we are taking this special step to help taxpayers, businesses and others who use this rate.” The IRS Commissioner Chuck Rettig said.

The revised standard mileage rate for business travel will be 62.5 cents, while the new rate for deductible medical or moving expenses (available for active-duty members of the military) will be 22 cents. Up 4 cents from the rates effective at the start of 2022. The 14 cents per mile rate for charitable organizations remains unchanged as it is set by statute.

While it’s always important to track mileage, it will be even more important in 2022 to make sure the correct rates apply to each trip and each period.

According to the IRS the standard mileage rate is optional. Taxpayers always have the option to calculate the actual cost of using their vehicle, which involves deducting a percentage of the vehicle’s total expenses. But either way, will be needed detailed record-keeping. Questions? Let's Talk!