CLIENT ALERT

For additional information contact:
Andrea Kriznauski
Marketing Coordinator
akriznauski@untracht.com

September 12, 2005

Standard Mileage Rates Increased

Standard Mileage Rates Increased for Final Four Months of 2005

The IRS has announced an increase in the optional standard mileage rates used by employees, self-employed individuals, and other taxpayers for the last four months of 2005. The rate has been increased to 48.5 cents per mile for all business miles driven between September 1 and December 31, 2005. This represents an increase of eight cents from the 40.5-cent rate in effect for the first eight months of 2005, as provided under Rev. Proc. 2004-64, I.R.B. 2004-49, 898. The increased four-month rate used for computing deductible medical or moving expenses is 22 cents per mile. The 14 cents-per-mile rate used for providing services to charitable organizations is set by statute and did not change.

The IRS usually updates the standard mileage rates on an annual basis during the fall season for the following calendar year. The increased standard mileage rates resulted from the recent increases in the cost of gasoline.

"With many predicting a decline in gas prices over coming months, we will hold off on setting the 2006 rate until closer to January," IRS Commissioner Mark W. Everson said. "Next year's rate could be lower than 48.5 cents."