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Counting the Miles

Using the new business mileage rate to calculate work-related driving expenses.

Each year the IRS announces a new "standard business mileage rate" that can be used by taxpayers to compute a deduction for the business use of a vehicle. This rate also can be used by employers to reimburse workers' substantiated business miles under an accountable expense reimbursement arrangement. The standard mileage rate is an important concept for church treasurers, since many churches reimburse staff members' business miles using this rate.

Example. Pastor Dave owns his car and kept records throughout 2012 showing that he drove the car a total of 15,000 miles, of which 6,000 miles were for business purposes (500 each month). Pastor Dave submitted records to the church treasurer each month documenting business miles driven for the previous month, and he was reimbursed at the standard mileage rate. The standard business mileage rate for 2012 was 55.5 cents per mile. ...

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Richard R. Hammar is an attorney, CPA and author specializing in legal and tax issues for churches and clergy.

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  • January 1, 2013

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