IRS Changing Gasoline Mileage Deduction Rates

Washington, D.C. (AHN) - The Internal Revenue Service is changing the amount that can be deducted for gas mileage.

IRS officials announced it is decreasing the amount that can be deducted for gas mileage when a person uses their car for business, charitable, moving or medical use, to coincide with a drop in gasoline prices.

Beginning Jan. 1, 2009, the standard mileage rates for the use of a car -including vans, pickups or panel trucks - will be 55 cents per mile for business miles driven, 20 cents per mile driven for medical or moving purposes and 14 cents per mile driven in the service of charitable organizations.

While the rate for charitable use is set by law and remains the same, the business use and medical and moving use rates both changed.

The drop comes after an increase in the middle of the year after gasoline prices had soared.

During the first half of 2008, the business mileage rate was 50.5 cents and in the second half it was 58.5 cents in the second half, while medical and moving rate was 19 cents during the first six months of the year and 27 cents in the last six.