Combat the Rising Cost of Fuel by Maximizing Your Mileage Deductions

BUSINESS WIRE--The IRS has just announced an increase in some deductible mileage rates starting July lst that will continue for the rest of 2008. With gas prices soaring, it’s a good time to be taking advantage of all possible tax deductible mileage. Liberty Tax (www.libertytax.com) offers a free mileage log to easily track your deductible mileage. Mileage for some business, medical, charitable, moving, and educational purposes may be deductible.

Here are the new mileage rates that will take effect July 1st through the end of this year:
Business mileage: to 58.5 cents per mile from 50.5 cents per mile
Medical or moving mileage: to 27 cents per mile from 19 cents per mile
Charitable mileage: stays at 14 cents per mile for 2008

“The IRS considers business mileage those miles driven from the office to an auxiliary business location,” said John Hewitt, Founder and CEO of Liberty Tax Service. “Commuting miles, the miles driven from home, to an office are not allowed. Students who are taking courses that are required by their employer, or are work-related, may deduct this mileage at the business mileage rate.”

Those moving this summer can deduct moving mileage if the move is at least 50 miles, and is necessary in order to start work at a new work location. Deductible moving expenses include the cost of moving furniture and household items as well as lodging expenses en route. Always be sure to notify the IRS of your relocation, by sending a Form 8822, Change of Address, to the IRS Service Center where you filed your last return.

Medical miles can be claimed for miles driven to and from the doctor or dentist, and to and from a pharmacy to pick up a prescription. Charitable mileage is deductible. If you volunteer for a charitable or non-profit organization, your mileage is deductible to and from meetings and functions.