The busiest travel time every year is around Thanksgiving. But plenty of folks also hit the road for Christmas.
Despite the craziness of the season and often messy, and dangerous, winter weather, we go. Why? Because, as Perry Como so melodiously notes, There's No Place Like Home for the Holidays.
Your travel to and from family gatherings at any time of the year is all on your own dime.
But as today's Christmas Tax Tip Tune notes, other types of travel are tax deductible. In fact, the Internal Revenue Service even makes it easier for you to figure your write-off by using standard mileage rates.
The biggest mileage-related tax claim is for miles traveled to conduct business. This typically is claimed by self-employed workers, either when you are your own boss as your main job or have a side business to earn a few extra dollars.
However, many companies reimburse employees for miles driven on behalf of the business. In most of these cases, the firms use the IRS' standard mileage rates to figure the corporate travel reimbursement amount.
Deductible rate dropping in 2014: If you do drive to business meetings, you might want to schedule a few more by Dec. 31. That way your travel will be worth a tad more tax-wise.
On Jan. 1, the standard deducible mileage rate will drop by half a penny, from 56.5 cents per mile to a flat 56 cents.
That one-half cent change is not only this week's By the Numbers figure, but it's also the amount by which each mile also will be reduced for deductible medical travel and moving.
The standard business mileage rate is, explains the IRS, based on an annual study of the fixed and variable costs of operating an automobile. The medical and moving rates, on the other hand, are determined by looking at just the variable costs of operating a car.
The biggest fixed automotive cost is the vehicle price.
Charitable driving deduction set: Neither fixed nor variable automotive costs factor into the charitable mileage deduction rate. That paltry 14 cents per mile is set by statute.
Sometimes Congress bumps the charitable rate up, but just for a limited time related to extraordinary circumstances.
The last time you could claim more than 14 cents driven on behalf of a charitable cause was after Hurricane Katrina devastated the Gulf Coast. A higher rate was allowed for travel for storm-related volunteer miles driven Aug. 25, 2005, thorugh Dec. 31, 2006.
Counting actual auto costs instead: If you also find the business, medical and moving mileage rates too small, you can claim your actual expenses. This includes the amounts paid for gas, oil, repairs, tires, insurance, registration fees, licenses and depreciation or lease payments that are attributable to the business portion of the total miles driven.
Parking fees and tolls also count. These amounts, however, can be claimed regardless of whether you use the actual auto expenses or standard mileage rate.
Obviously, you'll need to keep very good records in case an IRS examiner asks for substantiation. And if you use your car for both business and personal purposes, be sure to divide your expenses accordingly and are able to show the IRS your allocation method.
Here's hoping that your holiday travels home are safe and enjoyable. And here's also hoping you get a nice tax break from your deductible miles this and next year.
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