On January 1, 2014, the IRS standard mileage deduction rate decreased from 56.5¢ to 56¢ per mile for business miles driven. The rate for medical or moving purpose mileage also decreased from 24¢ to 23.5¢. The rate for miles driven in service of a charitable organization remained set at 14¢ per mile. The business rate is based on an annual study of the fixed and variable costs of operating an automobile. The medical and moving rate is based on the variable costs. The charitable rate is based on statute.
These rates impact all California employers because California requires that all employers reimburse their employees for all costs incurred in performing their job duties pursuant to Labor Code §2802. Employers who wish to pay less than the IRS mileage rate will have to prove that the actual expenses incurred are less than the established rate. In addition, taxpayers and employees still have the alternative option of calculating the actual costs of using a business vehicle.
Topics: IRS, Mileage Reimbursement, Travel
Published In: Labor & Employment Updates, Tax Updates
DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.
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