November 01, 1989
1989 Standard Mileage Rates Announced
WASHINGTON - The Internal Revenue Service released the 1989 standard mileage rates today for automobiles used in business, for charitable use, and for medical and moving expense purposes.
The business-use rate will be 25.5 cents a mile for the first 15,000 miles for a car that is not fully depreciated -- up from the 24 cents a mile used in 1988. The rate after the first 15,000 miles of business use of an automobile that is not fully depreciated and for all business use of an automobile that is fully depreciated is the same as in 1988 -- 11 cents a mile.
For use of an automobile for charitable activities, the rate will remain at 12 cents a mile in 1989. For medical and moving expense purposes, the rate used in computing deductions for 1989
will stay at nine cents a mile.
Taxpayers may deduct either the business standard mileage rate or actual expenses for business use of an automobile. In addition to the standard mileage rate, taxpayers may deduct the business portion of parking fees and tolls.
Revenue Procedure 89-62, which sets out the standard mileage rates for 1989, is attached and will be published in Internal Revenue Bulletin No. 1989-47, dated November 20, 1989.
The IRS also said that the mileage rate for business transportation paid by employers to employees in 1989 is increased to 25.5 cents a mile -- up from the 24 cents a mile used in 1988. The mileage rate, when used by an employer to reimburse employees' automobile expenses, is considered to meet the substantiation and adequate accounting requirements of section 1.274-5T of the Income Tax Regulations.
Revenue Ruling 89-120, which sets out the mileage allowance for transportation paid by employers to employees for 1989, is attached and will be published in Internal Revenue Bulletin No. 1989-47, dated November 20, 1989.
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