| Recent gas price trends have impacted the standard | | | | preferred method for expediency.FYI, a standard |
| mileage rate allowed by the IRS. Small business | | | | mileage rate is just used as a benchmark by the |
| owners should be aware of the latest adjustments | | | | federal government and many businesses to |
| and take full advantage of all available deductions.The | | | | reimburse their employees for mileage. It does not |
| IRS normally updates the mileage rates once a year in | | | | necessarily mean that such a benchmark accurately |
| the fall for the next calendar year. However, because | | | | represents every business. I recommend all businesses |
| of recent gas price trends, the IRS and Treasury | | | | owners discuss this overlooked item with their |
| Department recently announced an increase to the | | | | accountant or tax advisor.It could make a big |
| optional standard mileage rates for the final four | | | | difference in what you owe to Uncle Sam.Sharon |
| months of 2005. The rate will increase to 48.5 cents a | | | | Claar, CPA is the managing partner of JTB |
| mile for all business miles driven between Sept. 1 and | | | | Associates LLC. With over fifteen years experience in |
| Dec. 31, 2005. This is an increase of 8 cents from the | | | | accounting, information technologies, and business |
| 40.5 cent rate in effect for the first eight months of | | | | management, she is known for using cutting edge |
| 2005, as set forth in Rev. Proc. 2004-64.For small | | | | resources, tools, and innovative management |
| business owners, this does provide some relief, but | | | | consulting knowledge. Sharon enjoys rolling up her |
| business owners should proceed with caution and talk | | | | sleeves and working with her clients to solve their |
| with their tax advisors to decide which accounting | | | | everyday business problems. Prior to founding JTB |
| method provides the most accurate vehicle | | | | Associates, Sharon held various positions including: |
| deduction.In most cases, the actual costs of gasoline, | | | | Information Technology Controller with National |
| especially in current times, outweighs what the IRS | | | | Australia Bank, along with providing accounting |
| offers. While gasoline is a major factor in the mileage | | | | services to subsidiary companies; Finance Manager for |
| figure, other items enter into the calculation of mileage | | | | the American Medical Association and General Binding |
| rates, such as the price of new vehicles and | | | | Corporation, Auditor and Tax staff for Price |
| insurance.The optional business standard mileage rate | | | | Waterhouse Coopers, several years at Jackson |
| is used to compute the deductible costs of operating | | | | National Life Insurance, evaluating the effectiveness of |
| an automobile for business use in lieu of the extra | | | | their accounting procedures and computer systems. |
| burden of tracking actual costs, and often times, is the | | | | |