For tax purposes is using mileage better than using cost of gasoline

Question

For tax purposes is using mileage better than using cost of gasoline

Answer 1

I don't know where you live, but in the US, the IRS allows you to deduct 58.5 cents per mile for business (as of 7/1/08). At todays gas prices, unless your vehicle gets less than 7 mpg, you'll do better with the mileage.

Note - after seeing Brian's answer - it was $0.505 the first half of this year, but it is now $0.585 - it went up because of the greatly increased gas prices

hope this helps!

Answer 2

Yes. The mileage reimbursement attempts to include costs for maintenance, insurance, etc, so it is higher than what you would pay for just the gasoline. For example, if your car got a measly 15 mpg and you were paying $4.50 for a gallon of gas, the gas cost would still be only 0.$30 per mile compared to the standard $0.505 per mile the IRS allows.

Answer 3

jim,

I never thought of using the cost of gasoline.  Is that an option in your tax form?