The IRS Mileage Rate has been increased for the last 6 months of this year. IRS Commissioner, Doug Shulman, said that this reimbursement rate increase was in recognition of the increasing costs of operating a vehicle. With gasoline hovering around $4 a gallon this is welcome news for those who drive as part of their business or who wish to deduct the cost of moving, medical or charitable transportation costs and really need to save money on gas.
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The IRS Mileage Rate is usually increased only once a year. This increase from 50.5 cents a mile up to 58.5 cents a mile that can be applied to all deductible mileage from July 1, 2008 through December 31, 2008 will be a great help to many US taxpayers who run their own small business that requires transportation. The IRS Mileage Rate is usually only changed once a year in preparation for a new tax year. This early change will be welcome news by those being seriously impacted by rising gasoline prices on their small business operations.
Of course, this IRS Mileage Rate increase won’t have any impact on regular commuters since travel to and from a workplace isn’t deductible. Instead, these taxpayers should investigate various alternative fuel deductions that might help they get a tax break and save money on gas. This is the best way for the average taxpayer to take advantage of the IRS Mileage Rate.