IRS raises 2024 mileage rate despite lower gas prices

The big picture: The increase goes into effect Jan. 1, 2024, bringing the IRS rate to 67 cents per mile driven for business use, the federal agency announced in a statement Thursday.

• The rate is 11 cents higher than the 2021 rate.

Context: Taxpayers use the rate to calculate the "deductible costs of operating an automobile for business and certain other purposes" instead of tracking actual costs.

• It's also used as a benchmark by the federal government and many businesses to reimburse their employees for mileage.

2024 IRS mileage rate

Details: The following IRS rates apply to electric and hybrid vehicles as well as gasoline and diesel-powered cars...

• 67 cents per mile driven for business use, up 1.5 cents from 2023.
• 21 cents per mile driven for medical or moving purposes for qualified active-duty members of the Armed Forces, a 1-cent decrease from the 2023 rate.
• 14 cents per mile driven in service of charitable organizations is unchanged and is a rate set by statute, the IRS said.

Mileage tax deductions

Between the lines: The IRS said that "under the Tax Cuts and Jobs Act, taxpayers cannot claim a miscellaneous itemized deduction for unreimbursed employee travel expenses."

• Taxpayers also have the option of calculating the actual costs of using their vehicle rather than using the standard mileage rates, the IRS said.

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