IRS Announces 2006 Standard Mileage Rates
WASHINGTON, D.C. — The Internal Revenue Service has issued the 2006 optional standard mileage rates used to calculate the deductible costs of operating a vehicle for business, charitable, medical, or moving purposes. Beginning Jan. 1, 2006, the standard mileage rates for the use of a car, van, pickup, or panel truck will be:
44.5 cents per mile for business miles driven.
18 cents per mile driven for medical or moving purposes.
14 cents per mile driven in service of charitable organizations, other than activities related to Hurricane Katrina relief.
The new rate for business miles compares to a rate of 40.5 cents per mile for the first eight months of 2005. In September, the IRS made a special one-time adjustment for the last four months of 2005, raising the rate for business miles to 48.5 cents per mile in response to a sharp increase in gas prices, which topped $3 a gallon.
The standard mileage rates for business, medical, and moving purposes are based on an annual study conducted by Runzheimer International of the fixed and variable costs of operating an automobile. The mileage rate for charitable miles is set by statute.
For 2006, Katrina-related charitable rates will be 32 cents per mile for deduction purposes and 44.5 cents per mile for reimbursement purposes.