Notice 2013-80 [PDF 13 KB]—in addition to providing the standard mileage rates—also provides the amount taxpayers must use in calculating reductions to basis for depreciation taken under the business standard mileage rate, and the maximum standard automobile cost that may be used in computing the allowance under a fixed and variable rate (FAVR) plan.
According to related IRS release IR-2013-95 [PDF 94 KB], beginning on January 1, 2014, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) will be:
- 56 cents per mile for business miles driven
- 23.5 cents per mile driven for medical or moving purposes
- 14 cents per mile driven in service of charitable organizations (no change)
Notice 2013-80 provides that for an automobile the taxpayer owns and uses for business purposes, 22 cents of the 56 cents per mile rate is attributable to depreciation expense in 2014.
Notice 2013-80 will be released in Internal Revenue Bulletin 2013-52, dated December 23, 2013.
The standard mileage rate for business is based on an annual study of the fixed and variable costs of operating an automobile; the standard rate for medical and moving purposes is based on the variable costs as determined by the same study. The mileage rate for charitable miles is set by law.
Taxpayers always have the option of calculating the actual costs of using their vehicle rather than using the standard mileage rates. The business standard mileage rate can be used for an automobile that the taxpayer either owns or leases.
Rev. Proc. 2010-51 [PDF 49 KB] provides the rules for computing the deductible costs of operating an automobile for business, charitable, medical, or moving expense purposes; states that the number of business miles for the year must be substantiated; and explains what substantiation will be acceptable. Taxpayers using the standard mileage rates must comply with Rev. Proc. 2010-51.
Read TaxNewsFlash-United States: Notice 2012-72 - Standard mileage rates for 2013; business use to increase 1.0 cent per mile