Tag Archive for Standard mileage rate

Using a Car for Business? Grab These Deductions

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Whether you’re self-employed or an employee, if you use a car for business, you get the benefit of tax deductions.

There are two choices for claiming deductions:

1. Deduct the actual business-related costs of gas, oil, lubrication, repairs, tires, supplies, parking, tolls, drivers’ salaries, and depreciation.

2. Use the standard mileage deduction in 2014 and simply multiply 56 cents by the number of business miles traveled during the year. Your actual parking fees and tolls are deducted separately under this method. Read more

2014 Standard Mileage Rate

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The Internal Revenue Service has released the 2014 standard mileage rates for taxpayers to use in computing the deductible costs of operating an automobile for business, charitable, medical, or moving expense purposes. The following chart reflects the new 2014 standard mileage rates compared to the 2013 and 2012 tax year standard mileage rates.



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2014 Standard Mileage Rates For Business, Medical And Moving Announced

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The Internal Revenue Service issued the 2014 optional standard mileage rates used to calculate the deductible costs of operating an automobile for business, medical, charitable or moving purposes.

Beginning on January 1, 2014, the standard mileage rates for the use of a car (also pickups, vans, or panel trucks) will be:

• 56 cents per mile for business miles driven

• 23.5 cents per mile driven for medical or moving purposes Read more

“C” Is For Cars

iStock_ car XSmall“C” is for cars which can have a wide variety of tax implications.  If you commute with your used car to your W-2 job there isn’t a lot of tax implications, but for people who use their vehicle as part of a small business or self-employment, the tax implications are important.

The tax basics of cars are deducting the auto tabs each year and claiming mileage for volunteering efforts.  If the car is used for business, it gets more complicated.  You have the option of claiming either the standard mileage or the actual expenses for the vehicle.  With either method you choose, make sure to keep track of your miles driven.  The standard mileage is just that – a standard amount multiplied by the business miles driven.  For 2013 the standard mileage rate is 56.5 cents per mile.  The standard mileage rate is adjusted every six months by the IRS based on inflation and the price of gas.

Standard mileage is the easier method.  You don’t need to keep track of receipts, but you do need to keep careful track of the miles driven for business and personal use.  I would recommend writing down the odometer reading at the beginning of the year, and then keeping a log of the business miles driven.  Keep a pad of paper in the car and write down the date and the miles driven when you are driving for business reasons.  If you get pulled for an audit, the IRS is definitely going to look at your business miles.  If you don’t have good records it’s going turn your audit into a big hassle. Read more