The dollar per mileage rates, also known as standard mileage rates, are specific rates set annually that dictate the value per mile for different types of deductible travel, such as business, charitable, or medical purposes. These rates simplify the process of deducting vehicle expenses without needing to track actual costs like gas, oil, or depreciation.
For the year 2023, the standard mileage rates vary significantly based on the purpose of the travel, reflecting different tax treatment and motivations for the expense.
Standard Mileage Rates for 2023
Here is a breakdown of the dollar per mileage rates applicable for 2023:
| Purpose of Travel | Rate (Cents per Mile) | Rate (Dollars per Mile) |
|---|---|---|
| Business | 65.5 | $0.655 |
| Charitable | 14.0 | $0.140 |
| Medical | 22.0 | $0.220 |
It's important to understand the distinctions between these categories:
- Business Mileage: This rate is used for self-employed individuals and businesses to deduct the costs associated with using a personal vehicle for work-related travel. This includes trips to clients, business meetings, or professional development events.
- Charitable Mileage: This lower rate applies when you use your vehicle for volunteer work for qualified charitable organizations. Examples include driving to deliver meals for a charity or transporting items for a charitable event. The rate is set lower as charitable contributions generally receive different tax treatment.
- Medical Mileage: This rate is applicable for individuals who travel for medical care, including appointments, treatments, or necessary medical procedures. It helps offset the cost of transportation to receive eligible medical services.
These rates are crucial for taxpayers as they provide a straightforward method for calculating deductible transportation expenses. They are updated periodically to reflect changes in the costs of operating an automobile. For the most current information and detailed guidance, you can refer to official sources like the Internal Revenue Service (IRS) website.
Example Use Case:
If you drove 1,000 miles for business purposes in 2023, your deductible mileage expense would be 1,000 miles * $0.655/mile = $655.00.
