Standard Mileage Rate

StandardMileage Rate

The IRS has released the 2016 standard mileage rates for taxpayers to use in computing the deductible costs of operating an automobile for business, charitable, medical, or moving expense purposes. The following chart reflects the new 2016 standard mileage rates compared to the 2015 and 2014 tax year standard mileage rates.

2016 2015 2014
Business rate per mile 54.0¢ 57.5¢ 56.0¢
Medical and moving rate per mile 19.0¢ 23.0¢ 23.5¢
Charitable rate per mile 14.0¢ 14.0¢ 14.0¢
Depreciation rate per mile 24.0¢ 24.0¢ 22.0¢

On December 18, 2015, the President signed into law the Protecting Americans from Tax Hikes Act of 2015 (PATH Act). The new law extends several tax provisions retroactive to the beginning of 2015, and also makes some provisions permanent.

Additional Child Tax Credit. The refundable portion of the Child Tax Credit had an income threshold amount of $10,000, indexed for inflation. The extender legislation permanently sets the threshold at an unindexed $3,000, which will allow for a higher credit for taxpayers who qualify

Enhanced American Opportunity Tax Credit (Hope Credit). The American Opportunity Tax Credit (AOTC) is an enhanced version of the Hope Credit, allowing a credit of up to $2,500 for four years of post-secondary education. The new law makes the enhanced AOTC permanent.

Enhanced Earned Income Credit (EIC). As an extender item, the EIC credit amount was temporarily increased for taxpayers with three or more children, and the marriage penalty was reduced by increasing phase out ranges. The new law makes the enhanced EIC permanent.

Educator expenses. The new law makes the adjustment to income for qualified expenses of elementary and secondary school teachers permanent. The law also indexes the current expense cap of $250 for inflation beginning in 2016.

As always we hope this information is valuable to you and the ones you will share it with. Please do not hesitate to contact with us in case of any needs. 310.820.1080 or info@onts9.com

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