June 6, 2008, Newsletter Issue #119: 2005 Mileage Rate

Tip of the Week

For the first time in its history, the IRS adjusted the standard mileage rate during the year to reflect increases in the price of gasoline that occurred in 2005 due to inflation and the impact of hurricanes Katrina and Rita. If you used a vehicle for business travel, the standard mileage rate for federal tax deductions is $0.405 for travel from January 1 to August 31, 2005 and $0.485 for travel from September 1 to December 31, 2005. Mileage can also be deducted if it was logged for medical reasons or as part of a deductible move. The mileage rates for these personal tax deductions are $0.15 from January 1 to August 31, 2005, and $0.22 from September 1 to December 31, 2005.

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