IRS Hikes Standard Business Milage Rate Mid-Year

With gas prices soaring at the pumps, the IRS has increased the standard business travel reimbursement rate to 62.5 cents per mile, up 4 cents from the rate of 58.5 cents that went into effect in January.

The new rate goes into effect on July 1 through December 31. The rate applies for use of a car, van, pickup or panel truck.

“The IRS is adjusting the standard mileage rates to better reflect the recent increase in fuel prices,” IRS Commissioner Chuck Rettig said in a statement. “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 last time the IRS boosted the rates at mid-year was back in 2011.

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