The IRS recently announced the optional 2022 standard mileage rates for taxpayers to use in calculating the deductible costs of using an automobile for business, charitable, medical or moving expense (for members of the Armed Forces) purposes. Further, the notice announced the amount that must be included in the employee's income and wages for the personal use of an employer-provided automobile.
Beginning on January 1, 2022, the standard mileage rate for transportation or travel expenses is 58.5 cents per mile for all miles of business use (an increase from 56 cents per mile in 2021). Taxpayers have the option of calculating the actual costs of using their vehicle rather than using the standard mileage rates.
These new rates are effective for the expenses incurred on or after January 1, 2022.
The new changes are summarized below:
| The standard mileage rates used for: | 2022 | 2021 |
|---|---|---|
| Business | 58.5 cents/mile | 56 cents/mile |
| Medical care | 18 cents/mile | 16 cents/mile |
| Certain moving expenses by members of the Armed Forces on active duty | 18 cents/mile | 16 cents/mile |
| Use by charitable organizations (under the Sec. 170) | 14 cents/mile | 14 cents/mile |
For the complete 2022 released rates and additional details, please refer to the IRS Notice 2022-03.
Employers should be aware of these changes.