IR-2008-131, Nov. 24, 2008

WASHINGTON — The Internal Revenue Service today issued the 2009
optional standard mileage rates used to calculate the deductible costs
of operating an automobile for business, charitable, medical or moving
purposes.

Beginning on Jan. 1, 2009, the standard mileage rates for the use of a
car (also vans, pickups or panel trucks) will be:

55 cents per mile for business miles driven
24 cents per mile driven for medical or moving purposes
14 cents per mile driven in service of charitable organizations
The new rates for business, medical and moving purposes are slightly
lower than rates for the second half of 2008 that were raised by a
special adjustment mid-year in response to a spike in gasoline prices.
The rate for charitable purposes is set by law and is unchanged from
2008.

The business mileage rate was 50.5 cents in the first half of 2008 and
58.5 cents in the second half. The medical and moving rate was 19
cents in the first half and 27 cents in the second half.

The mileage rates for 2009 reflect generally higher transportation
costs compared to a year ago, but the rates also factor in the recent
reversal of rising gasoline prices. While gasoline is a significant
factor in the mileage rate, other fixed and variable costs, such as
depreciation, enter the calculation.

The standard mileage rate for business is based on an annual study of
the fixed and variable costs of operating an automobile. The rate for
medical and moving purposes is based on the variable costs as
determined by the same study. Independent contractor Runzheimer
International conducted the study.

A taxpayer may not use the business standard mileage rate for a
vehicle after using any depreciation method under the Modified
Accelerated Cost Recovery System (MACRS) or after claiming a Section
179 deduction for that vehicle. In addition, the business standard
mileage rate cannot be used for any vehicle used for hire or for more
than four vehicles used simultaneously.

Taxpayers always have the option of calculating the actual costs of
using their vehicle rather than using the standard mileage rates.