29 Aug The business vehicle mileage deduction rate increases again due to rising fuel costs
The IRS has increased the business vehicle mileage deduction rate from $.585/mile to $.625/mile effective July 1, 2022. This is a 6.4% increase. Those clients that take the mileage method to expense the business use of their personal vehicle, and use a mileage log to calculate a monthly mileage reimbursement, will need to increase that amount reimbursed accordingly. This includes owner employees of S Corporation entities. Those clients that are taking the actual expense method to expense and depreciate their vehicle(s) — in lieu of the mileage method — need not change what they are doing. They will keep paying for their actual vehicle expenses out of their business. Feel free to contact us at Unbehagen Advisors for further information about how this impacts your business and taxes. For a further understanding of this mileage rate change in 2022 please visit https://www.irs.gov/newsroom/irs-increases-mileage-rate-for-remainder-of-2022.