IRS Increases Mileage Reimbursement For Many Workers
Get Paid To Drive and save on fuel expenses - Up to $58.50 for each 100 miles you drive
Great news if you drive for work. Did you know that you can get paid by the government or your employer for all the driving you do?
The IRS, (news release - IR-2008-32) just increased (effective July 1, 2008) the amount you can deduct for car expense.
Example: Let’s say you drive 120 miles round trip a day for your job, or 600 miles a week. You’ll be able to deduct $351 a week off your taxes. And because many employers also reimburse you for your driving, your employer might have increased your reimbursement to match what the IRS allows (from the old 50.5 cents to the new 58 cents a mile).
Even if you drive a gas-guzzling SUV, $351 will more than cover all your gasoline costs, based on the above example.
The Gas Credit works two ways:
1) If your employer reimburses you for your driving, make sure they have raised the allowance to match what the IRS guidelines say. Most employers do. Keep track of your mileage and turn it in to your job.
2) If your employer doesn’t reimburse you for your driving, you’re still in luck. You can deduct this amount off your taxes at the end of the year as an “un-reimbursed employee expense”. That means if you drive 18,000 miles a year for work, you’ll be able to deduct $10,530 from your taxable income.
There are also a couple of neat deductions even if you don’t drive for work that have also just been increased.
If you drive for medical reasons (to the doctor) or for moving to a new residence, you can deduct 27 cents a mile. This is a boon for people who might drive a lot to various doctor appointments. Say you drive 100 miles a week to the doctor. You’ll be able to deduct $27 a week off your taxes.
For more information on this and other government giveback programs, sign up in the box above.
