Fox Accounting & Tax Services Inc.                                    (503)246-6994   Income Tax Preparation, Payroll & Bookkeeping Services

The Internal Revenue Service has issued the 2019 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, 2019, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) will be:

• 58 cents per mile driven for business use, up 3.5 cents from the rate for 2018,
  
• 20 cents per mile driven for medical or moving purposes, up 2 cents from the rate for 2018, and
• 14 cents per mile driven in service of charitable organizations.

The business mileage rate increased 3.5 cents for business travel driven and 2 cents for medical and certain moving expense from the rates for 2018. The charitable rate is set by statute and remains unchanged.
It is important to note that under the Tax Cuts and Jobs Act, taxpayers cannot claim a miscellaneous itemized deduction for unreimbursed employee travel expenses. Taxpayers also cannot claim a deduction for moving expenses, except members of the Armed Forces on active duty moving under orders to a permanent change of station. For more details see Notice-2019-02.
The standard mileage rate for business use 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.


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

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 more than four vehicles used simultaneously.

• 54.5 cents per mile for business 
• 18 cents per mile for medical
• 14 cents per mile for charity

​

​Individuals who have earned income may make deductible contributions to a traditional IRA up to $5,500 or that year's compensation from wages or self-employment, whichever number is lower. The contribution limit is $6,500 for taxpayers age 50 or above. You can make deductible contributions to your IRA up to April 18, 2016 this year's tax filing deadline.

The deduction for taxpayers contributing to a traditional IRA is phased out for singles and heads of household who are covered by a workplace retirement plan and have modified adjusted gross incomes (AGI) between $63,000 and $73,000. These thresholds are unchanged from 2015. For married couples filing jointly, in which the spouse who makes the IRA contribution is covered by a workplace retirement plan, the income phase-out range is $101,000 to $121,000. For a married individual filing a separate return who is covered by a workplace retirement plan, the phase-out range is not subject to an annual cost-of-living adjustment and remains $0 to $10,000.

Individuals who exceed these phase out thresholds may still contribute to their IRA but will be unable to deduct the contributions.
​

Like traditional IRAs, Roth IRA contributions are limited to $5,500/$6,500. Contributors must have earned income at least equal to their contribution amount. But Roth contributions are not deductible and Roth distributions are not taxed.

Unlike traditional IRAs, Roth IRAs also have an income test for eligibility. Individuals with adjusted gross income above certain levels may not contribute to a Roth. The AGI phase-out range for taxpayers making contributions to a Roth IRA in 2018 is $189,000 to $199,000 for married couples filing jointly. For singles and heads of household, the income phase-out range is $120,000 to $135,000.  As with the traditional IRA, the phase out limit For married separate is $10,000.

Taxpayers in these ranges will have their maximum Roth contribution amounts "phased out" with the amount at the lower end close to the max and the amount at the upper end near zero. ​

As of Jan. 1, 2016, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) are:

• 54 cents per mile for business miles driven.
• 19 cents per mile driven for medical or moving purposes.
• 14 cents per mile driven in service of charitable organizations.

​

As of Jan. 1, 2015, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) are:

• 57.5 cents per mile for business miles driven.
  
• 23 cents per mile driven for medical or moving purposes.
  
• 14 cents per mile driven in service of charitable organizations.

Beginning on Jan. 1, 2014, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) will be:

• 56 cents per mile for business miles driven.
  
• 23.5 cents per mile driven for medical or moving purposes.
  
• 14 cents per mile driven in service of charitable organizations.