Optional Rates Are Increased From 2017

The Internal Revenue Service (IRS) has issued the 2018 optional standard mileage rates used to calculate the deductible costs of operating an automobile for business, charitable, medical, or moving purposes.

2018 Standard Mileage Rates
Beginning on January 1, 2018, the standard mileage rates for the use of a car (also vans, pickups, or panel trucks) will be:

  • 54.5 cents per mile for business miles driven (up 1 cent from 2017)
  • 18 cents per mile driven for medical or moving purposes (up 1 cent from 2017)
  • 14 cents per mile driven in service of charitable organizations (unchanged from 2017)

Taxpayers always have the option of calculating the actual costs of using their vehicle rather than using the standard mileage rates.

Limitations on Use of Standard Mileage Rates
A taxpayer may not use the business standard mileage rate for a vehicle after using any depreciation method under the Modified Accelerated Cost Recovery System or after claiming a Section 179 deduction for that vehicle. In addition, the business standard mileage rate cannot be used for more than four vehicles used simultaneously.

IRS Notice 2018-03 contains additional information about mileage rates.

For more on employer-provided transportation benefits, please see our section on Fringe Benefits.

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