In another year-end tradition, IRS has announced – after extensive scientific research and calculations – what its standard mileage rates will be for next year’s tax returns. These new rates don’t affect the 2023 returns that will be filed in 2024. These new rates will be for the 2024 returns that will be filed in 2025, but will be useful right away for businesses that base their employee reimbursements and customer charges on the IRS rates.

From the IRS news release:

Beginning on Jan. 1, 2024, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) will be:

• 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 decrease of 1 cent from 2023.
• 14 cents per mile driven in service of charitable organizations; the rate is set by statute and remains unchanged from 2023.

These rates apply to electric and hybrid-electric automobiles as well as gasoline and diesel-powered vehicles.

Just as with the annual inflation adjustments for tax brackets and deductions that I covered a little while ago, there are some items that have been carved into stone by our imperial rulers in DC and are not allowed to be adjusted for changes in the real world costs. Miles driven on behalf of charities have been established at 14 cents since 1997 and I have seen no inclination from anyone in DC to bring that more in line with the business mileage rate of 67 cents. To use the same rate for both kinds of driving would be the sane and logical thing to do; both of which are foreign concepts in the Twilight Zone known as Washington DC.

Since numbers are an obsession of mine – a common side effect of being a CPA – I couldn’t help noticing the correlation between the IRS deduction per business mile and the Post Office’s charge for a standard single ounce stamp. For the year 2000, the IRS mileage rate was 32.5 cents, and it is now up to 67 cents for 2024. USPS charged 33 cents for one ounce in 2000 and is currently up to 60 cents, with multiple increases planned for 2024.