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Optional standard mileage rates issued for 2019

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Tax Hot Topics newsletterThe IRS issued Notice 2019-02, providing the 2019 optional standard mileage rates used to calculate the deductible costs of operating an automobile for business, charitable, medical or moving purposes. In lieu of using the optional standard rates, taxpayers have the option of calculating the actual costs of using their vehicle, but only if taxpayers maintain adequate records or other sufficient evidence of the actual costs incurred.

Beginning on Jan. 1, 2019, the standard mileage rates for the use of an automobile are:

  • 58 cents per mile for business miles driven (up from 54.5 cents that was in effect for 2018)
  • 20 cents per mile driven for medical or moving purposes (up from 18 cents that was in effect for 2018)
  • 14 cents per mile driven in service of charitable organizations (no change from prior years)

The Tax Cuts and Jobs Act (TCJA) suspended all miscellaneous itemized deductions subject to the 2% of adjusted gross income (AGI) floor, including unreimbursed employee travel expenses, for taxable years 2018 through 2025. TCJA also suspended the deduction for moving expenses for those same years. However, the suspensions do not apply in certain circumstances

The miscellaneous itemized deduction suspension does not apply to deductions for expenses that are deductible in determining AGI (i.e., above the line deductions). For example, members of a reserve component of the Armed Forces of the United States, state or local government officials paid on a fee basis, and certain performing artists are entitled to deduct unreimbursed employee travel expenses as an adjustment to total income on Line 24 of Schedule 1 of Form 1040 (2018). Similarly, with respect to the moving expenses suspension, the suspension does not apply to members of the Armed Forces on active duty who move pursuant to a military order and incident to a permanent change of station to which Section 217(g) applies.

Contacts:
Jeff Martin
Partner
Washington National Tax Office
T +1 202 521 1526

Keith Mong
Managing Director
Washington National Tax Office
T +1 202 521 1554

James Sanchez
Senior Associate
Washington National Tax Office
T +1 202 861 4107

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