How to Use the Different Types of Standard Mileage Rates
Did you know there are other types of miles you can drive and deduct on your federal tax return? The standard mileage rate isn’t only for business miles. There are medical miles and charity miles too. What in the world are charity miles?
Charity Miles and the Standard Mileage Rate
Charity miles are miles you put on your personal vehicle while performing a charity. This requires an example…let’s say for example you volunteer for a fictional charity we’ll call Driving Miss Daisy. This organization drives around old folks who no longer have the ability to dive themselves. Volunteers sign up and get assigned trips according to what the members require. If you are a volunteer for Driving Miss Daisy then those miles you drive can be multiplied by the standard mileage rate for charity driving and deducted on your federal income tax return.
The standard mileage rate for charity miles is 14 cents per mile. It’s adjusted each year to keep up with inflation but this one hasn’t changed in a few years.
Medical Miles and the Standard Mileage Rate
The Medical miles tax deduction is similar to the charity miles. If you have to drive somewhere for medical purposes, either for yourself or for someone else, it’s like charity miles: keep track of the number of miles you drive for this purpose and claim a mileage tax deduction on your IRS tax return. The rate for medical miles is lower than than business mileage rate: it’s 23 cents per mile.
With medical miles, there are a lot more ways you can be traveling for medical reasons so whether you use the standard mileage rate or claim actual expenses will entirely depend on your particular situation. Sometimes a trip must be taken for medical reason, in which case you’ll be claiming actual expenses.
How to Claim Those Charity and Medical Miles on Your Taxes
How do you claim charity or medical miles with the IRS? Very carefully, that’s how! And this actually goes for any type of tax deduction involving mileage rates. The IRS loves to audit the tax returns of people who claim the standard mileage rate because in the past it’s been a major area of cheating on taxes. This is especially true of the business mileage deduction, but don’t get sloppy with your charity miles or medical miles, either.
Usually you don’t have the option of reimbursement from the charity you drive for…after all it’s a charity. Business miles are different since sometimes it’s written into your contact that you’ll be reimbursed. The business can do whatever they please so find out first before you simply claim the standard mileage rate for businesses. Maybe you’re getting reimbursed already.
The standard mileage rate set by the IRS each year is only a guide. For business miles, businesses can choose to use that rate or set their own rates. Businesses don’t even have to reimburse their employees for miles driven on personal vehicles. The IRS will let you deduct your business miles driven when it comes to preparing your federal income tax return.
Keep a written log of the miles you dive for charity or medical purposes and you’ll be just fine in case the IRS wants to audit your return. For years, it was easier to get away with just reporting the miles you drove and taking that tax deduction. But now the IRS wants to see a log. With smartphone apps it’s actually pretty easy to keep a log of miles driven so it’s now easier than ever to claim the standard mileage rate.