The IRS recently announced the standard mileage rate to be used for 2011.
The standard mileage rate is the rate that taxpayers use to calculate their deduction for business use of their automobile. Also allowed are deductions for using your personal vehicle for medical and charitable purposes.
The standard mileage rate for 2011 for business miles driven is 51 cents per mile. Each year an independent company studies the cost of operating a vehicle (for business use, both the fixed and variable costs of operating a vehicle are considered) to determine the standard mileage rate. The 2011 rate is just slightly higher than the standard mileage rate for 2010.
For medical and charitable purposes only the variable cost is considered, thus the rate is generally lower than the business rate. For 2011, the mileage rate for medical mileage is 19 cents per mile; the rate for charitable miles is 14 cents per mile.
If you are an online business owner, you may think you don’t use your vehicle enough to make it worth while, especially if you work from home. However, there are many circumstances that you may need to use your personal vehicle for business, such as:
- trips to the post office (this can really add up if you ship inventory)
- trips to the office supply store
- trips to meet clients or business associates for lunch or other business related meetings
- trips to continuing education events (conferences and classes, either local or overnight)
The best way to keep track of your mileage is to keep a travel log (available at any office supply store) in your car and to write down the beginning and ending odometer reading. If you go to the same destinations over and over again, you could also keep a calendar with business related trips on it, and use Mapquest or Google maps to calculate the miles.
