Alert: 2010 Standard Mileage Rates Announced

By December 4, 2009 Businesses

2010 standard mileage rates for reimbursement are dropping in 2010.  The IRS claims a down economy and lower oil prices in 2010 have kept fuel prices relatively low this past year.  However, most Americans are still feeling a pinch in their wallet due to lower overall household income which started declining in the 4th quarter of 2007.  As a result, the new IRS mileage reimbursement rates for the coming year will actually be lower than they were in 2009 or 2008.

The standard business mileage rate will drop 5 cents to 50 cents per mile.
Medical and moving mileage will drop 7.5 cents to 16.5 cents per mile.
Mileage in service of charitable organizations will remain at 14 cents per mile, where it has been for several years now.

Remember that you can deduct either standard mileage rates or depreciation and actual expenses o20n a vehicle depending on the legal structure of your business and on how its titled.  Once you have decided to start depreciating a vehicle, you cannot switch to the standard mileage rate to deduct your expenses.  Keep this in mind especially if you are planning on taking advantage of Section 179 and bonus depreciation this year.