IRS to raise mileage rate again?

May 14, 2008 by Carol Katarsky

Posted in: IRS regs, In this week's e-newsletter, Internal controls, Latest news & views, T&E

Here’s a ray of hope if traveling employees are grumbling about travel expenses.

There’s increasing pressure on IRS to raise the standard business mileage rate again mid-year
A recent study by AAA says the average cost of driving a vehicle is up to 54.1 cents per mile. The current reimbursement rate is only 50.5.

With gas prices continuing to rise — and showing no sign of slowing down — the Service may have to do another mid-year hike to keep pace with the inflation.

If it doesn’t, expect a major hike at the end of this year.

Edited to correct ‘08 rate.

Tags: IRS, mileage rate, Reimbursements

4 Responses to “IRS to raise mileage rate again?”

Roxie Gentzel Says:
May 15th, 2008 at 12:45 pm
I agree with you about the potential for another mileage rate hike but would like to point out that the current rate is now 50.5 cents/mile. Car pooling may become a necessity plus a benefit that companies should investigate for their ‘burb dwelling’ workers.
Dana Campbell Says:
May 15th, 2008 at 3:11 pm
What about those companies that can’t afford to just pay more? Increasing the product cost is not always an option to cover these additional expenses. Squeeze the employer once again…
DJ (aka bigfanx) Says:
May 15th, 2008 at 7:44 pm
Person Campbell: If companies can’t afford to pay the reimbursement, they sure as heck can’t afford to do without the business it generates. Sales force members that contact potential clients and keep in touch personally with existing clients contributes to the revenues. When staff members use their PERSONAL vewhicles to make these contacts, I’m thinking the company surely wouldn’t be able to afford company cars, taxes on vehicles, licenses, insurance as other expenses. Why do you oppose the reimbursement increase?

On another note, volunteers for charity can only claim 14 cents per mile for their transportion costs… it’s been that way for a few years… it’s HIGH TIME that changed!
Carol Katarsky Says:
May 15th, 2008 at 8:47 pm
DJ: You make a good point about the charity rate. That’s actually determined by Congressional legislation, but the business rate is determined largely by a yearly study of travel costs.

Since the rate hasn’t changed in years, I can only assume that reimbursing charitable volunteers isn’t high on Congress’ priority list. Perhaps in an election year they’ll be inclined to be more generous.