Standare mileage rates

[NadCixelsyd]

Why are there different mileage rates for business ($0.535/mile), medical ($0.17/mile), and charity work ($0.14 per mile)? Gas/wear/insurance, etc. are the same whether I'm on a business trip of doing charity work.

Is the standard rate all-inclusive, without exception or are any automobile expenses allowed in addition to the standard rate? For example, if I'm in an accident while on charity work, can I deduct my deductible, or is that just part of the paltry 14 cents per mile that I'm allowed? What about the rental car that I then have to rent for two weeks while my own car is being repaired? Can I deduct my own car by the "standard" rate, but use the actual amount paid to Avis while my own car is in the shop?

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[Arthur Rubin]

On Friday, April 21, 2017 at 6:54:45 PM UTC-7, NadCixelsyd wrote:
> Why are there different mileage rates for business ($0.535/mile), medical ($0.17/mile), and charity work ($0.14 per mile)? Gas/wear/insurance, etc. are the same whether I'm on a business trip of doing charity work.
>
> Is the standard rate all-inclusive, without exception or are any automobile expenses allowed in addition to the standard rate? For example, if I'm in an accident while on charity work, can I deduct my deductible, or is that just part of the paltry 14 cents per mile that I'm allowed? What about the rental car that I then have to rent for two weeks while my own car is being repaired? Can I deduct my own car by the "standard" rate, but use the actual amount paid to Avis while my own car is in the shop?

The standard rate is all-inclusive, medical is all-inclusive (with "fixed costs" not allowed), and charity is all-inclusive (with "fixed costs" not allowed), not updated for inflation.

Additional allowable expenses include tolls, parking, interest, and taxes.

"Fixed costs" include depreciation or lease payments, license and registration fees (but not the part considered property taxes), and insurance.

--
Arthur Rubin, AFSP, CRTP, Brea, CA

[Stan Brown]

On Fri, 21 Apr 2017 21:51:53 EDT, NadCixelsyd wrote:
>
> Why are there different mileage rates for business ($0.535/mile),
> medical ($0.17/mile), and charity work ($0.14 per mile)?
> Gas/wear/insurance, etc. are the same whether I'm on a business
> trip of doing charity work.

Because politics. It's obvious why the business rate is so high: it's
a deduction of interest to the lobbyists who write the tax code.

You forgot moving expenses, which match medical. Source:
https://www.irs.gov/uac/2017-standard-mileage-rates-for-business-and-
medical-and-moving-announced

That same page says "The charitable rate is set by statute", so that
explains why it's different from the others.

The page goes on to say "The standard mileage rate for business is
based on an annual study of the fixed and variable costs of operating
an automobile. The rate for medical and moving purposes is based on
the variable costs." That sounds objective, but the fact that
business can write off fixed costs but humans cannot is politics.

> Is the standard rate all-inclusive, without exception or are any
> automobile expenses allowed in addition to the standard rate? For
> example, if I'm in an accident while on charity work, can I deduct
> my deductible, or is that just part of the paltry 14 cents per mile
> that I'm allowed? What about the rental car that I then have to
> rent for two weeks while my own car is being repaired? Can I deduct
> my own car by the "standard" rate, but use the actual amount paid
> to Avis while my own car is in the shop?

"Taxpayers always have the option of calculating the actual costs of
using their vehicle rather than using the standard mileage rates."
says the above link.

For guidance of "actual costs", there's
https://www.irs.gov/pub/irs-drop/rp-10-51.pdf
which says "... the applicable standard
mileage rate for charitable, medical, or moving expense miles is in
lieu of a deduction for variable expenses (including gasoline and
oil) of the automobile allocable to those purposes. Costs for items
such as depreciation or lease payments, insurance, and license and
registration fees are not deductible for these purposes ..."

You can take the standard rate, or you can compute actual _variable_
expenses. It doesn't specifically mention a deductible, but
technically that's not an expense. Rather, repairs for the accident
are the expense, and your insurance reimburses you for part of it.
But I don't believe you can deduct automobile repairs or rentals
because they are not directly connected with the charity or medical
or moving purpose. I don't believe you can deduct an insurance
deductible, any more than you can deduct the cost of insurance (as
part of charitable, medical, or moving expenses).

You _can_ add parking fees and tolls to the standard rates: "A
taxpayer may deduct, as separate items, parking fees and tolls
attributable to the use of the automobile for charitable, medical, or
moving expense purposes."

--
Stan Brown, Oak Road Systems, Tompkins County, New York, USA
http://BrownMath.com/
http://OakRoadSystems.com/
Shikata ga nai...

[Stan Brown]

On Sat, 22 Apr 2017 09:37:21 EDT, Arthur Rubin wrote:
> The standard rate is all-inclusive, medical is all-inclusive (with
> "fixed costs" not allowed), and charity is all-inclusive (with
> "fixed costs" not allowed), not updated for inflation.
>
> Additional allowable expenses include tolls, parking, interest, and
> taxes.

Interest and taxes? Are you sure? My understanding is that those
are fixed costs, so you can claim them only if you compute actual
cost, and only on business mileage, but not for medical, moving, or
charity at all.

(I'm assuming by "taxes" you mean a property tax on the automobile
itself. Taxes on parking fees are of course allowable along with the
parking fees themselves, though it's not usual for them to be stated
separately, at least in my experience.)

--
Stan Brown, Oak Road Systems, Tompkins County, New York, USA
http://BrownMath.com/
http://OakRoadSystems.com/
Shikata ga nai...

[Stuart O. Bronstein]

Stan Brown <the_sta...@fastmail.fm> wrote:
> Arthur Rubin wrote:

>> The standard rate is all-inclusive, medical is all-inclusive (with
>> "fixed costs" not allowed), and charity is all-inclusive (with
>> "fixed costs" not allowed), not updated for inflation.
>>
>> Additional allowable expenses include tolls, parking, interest,
>> and taxes.
>
> Interest and taxes? Are you sure? My understanding is that those
> are fixed costs, so you can claim them only if you compute actual
> cost, and only on business mileage, but not for medical, moving, or
> charity at all.
>
> (I'm assuming by "taxes" you mean a property tax on the automobile
> itself. Taxes on parking fees are of course allowable along with
> the parking fees themselves, though it's not usual for them to be
> stated separately, at least in my experience.)

I suspect he meant interest on a loan to purchase the car, and sales
tax at that same time. Those are not fixed costs necessarily related
to owning a car.

--
Stu
http://DownToEarthLawyer.com