global Tax 2018 Standard Mileage Rates Released December 15, 2017 The 2018 standard mileage rates are out! Read up on the new rates, and learn how you can reduce your fuel consumption this year. Attention drivers, the 2018 standard mileage rates have been released. The IRS announced the rates today, which are used for determining the deduction for the costs of operating a vehicle for various business, charitable, moving, or medical reasons. What are the changes for 2018? Starting January 1st 2018, the standard mileage rates (for use of a car, van, pickup or panel truck) are: 54.5 cents for business miles driven (up from 53.5 cents per mile in 2017) 18 cents per mile driven for medical or moving purposes (up from 17 cents per mile in 2017) 14 cents per mile driven in service of charitable organizations (no change from 2017) The portion of the business standard mileage rate that is treated as depreciation will be 25 cents per mile for 2018, unchanged from 2017. How are the rates calculated? There are various factors that influence the standard mileage rates, including: Gas and oil prices Insurance costs The state of the economy The expected cost of typical wear and tear on a vehicle Hence the rates are purposed to go over and above the amounts a consumer pays solely for gas.How can I reduce my fuel consumption? Looking for ways to save money and reduce fuel consumption? There are a few things you can do to make the most out of a tank of gas: Stop speeding. For every 5 miles you drive over 60 miles per hour, you are reducing your fuel economy by potentially 7%. Make a concerted effort to maintain a constant speed, as speeding up and slowing down frequently can severely lower your gas mileage. Cruise control can help! Though tempting, letting your car warm up for 10 minutes during the heart of winter can cost you $0.04 per minute ($2.80 per week of wasted gas). Consider a tune up—it can increase your mileage by 4%. Consider cleaning your car and removing extra cargo from both the vehicle and the roof rack. Extra weight can reduce your fuel economy as well. Is the standard mileage rate the only way to gauge deductions? No, taxpayers always have the option to claim deductions based on the actual costs of using a vehicle, as an alternative to using the standard mileage rates.FAVR Plans Wondering how to calculate the allowance under a fixed and variable rate (FAVR) plan? This is an IRS revenue procedure that can be used to reimburse mobile employees tax-free for both the fixed and variable costs associated with driving for business. The max standard car cost is $27,300 for 2018 (in 2017 this was $27,900), and the maximum truck and van cost has decreased $300 from 2017 and is now $31,000. Under this plan, a standard amount is substantiated for an employer’s reimbursement to employees for expenses they incur driving a vehicle while performing services for the employer. Questions on the standard mileage rates for 2018? Contact any member of our Tax Services Team.