Press Release: IRS Ups Mileage Deduction

This year’s tax deduction for business mileage is going up to 40.5 cents, according to Runzheimer International. The Wisconsin-based consultants say the new rate, effective on January 1, is a 3-cent increase from last year’s rate of 37.5 cents. The consulting firm recommends the yearly writeoff to the Internal Revenue Service based on operation costs. Ted Schuerman, Director of Research & Client Service within Government Services at Runzheimer International, says that, “although fuel costs spiked to their highest point of the year nationally in June 2004, gasoline prices represented only part of the increase.” Schuerman adds that auto insurance is another major factor in the rise in the deduction; maintenance costs remained stable.