Beginning on Jan. 1, 2016, the standard mileage rates for the use of a car, van, pickup or panel truck will be:
• 54 cents per mile for business miles driven, down from 57.5 cents in 2015
• 19 cents per mile driven for medical or moving purposes, down from 23 cents for 2015
• 14 cents per mile driven in service of charitable organizations
The business mileage rate decreased 3.5 cents per mile and the medical, and moving expense decreased 4 cents per mile from the 2015 rates. The charitable rate is based upon statute.
For self-employed business owners, interest expense paid on the car loan is also deductible, above and beyond the standard mileage rate.
Parking and tolls are always separately deductible.
The standard mileage rate for business is based on an annual study of the fixed and variable costs of operating an automobile, including depreciation, insurance, repairs, tires, maintenance, gas and oil. The rate for medical and moving purposes is based on the variable costs, such as gas and oil.