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As Gas Prices Soar, IRS Will Raise Deductible Mileage Rate by 4 Cents on July 1

Ruth Singleton
Published Date:
Jun 10, 2022


In response to the rising cost of gas, the IRS announced that it will increase the optional standard mileage rates for the deductible costs of business travel by 4 cents, to 62.5 cents per mile. The change will become effective July 1. 

The rates for deductible medical and moving expenses for active-duty members of the military will also increase by 4 cents, to 22 cents per mile. The 14 cents-per-mile rate for charitable organizations, set under Sec. 170(i) of the Internal Revenue Code, will not change. 

According to Accounting Today, the IRS usually updates the mileage rates only once a year—in the fall for the next calendar year. It made an exception this year because of rising gasoline prices. The last time the IRS made such a mid-year mileage increase was 11 years ago. 

The optional business standard mileage rate allows taxpayers to compute the deductible costs of operating a car for business use instead of tracking the actual costs. The federal government and many businesses use this rate as a benchmark to reimburse their employees for mileage. 

Rates for the first half of the year can be found in Notice 2022-23 

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