The Internal Revenue Service (IRS) has issued the 2019 optional standard mileage rates (Notice 2019-2). After having a slight increase last year, the increase in 2019 will be more significant. Beginning on January 1, 2019, the standard mileage rates for business use of a car, van, pickup truck or panel truck will be 58 cents per mile (up from 54.5 cents in 2018).
The standard mileage rate for medical or moving purposes will increase two cents in 2019 to 20 cents per mile (18 cents per mile in 2018). The rate in service for charitable organizations remains unchanged at 14 cents per mile (currently fixed by Congress).
The optional standard mileage rates are used to calculate the deductible amount of business, moving, medical or charitable expense (miles driven times the applicable rate). If your car is for business and personal use, you’ll want to keep adequate records and subtract out personal miles. Mileage accumulated by driving to and from your primary workplace or office is excluded from the deduction.
With The Tax Cuts and Jobs Act of 2017, taxpayers can no longer claim a miscellaneous itemized deduction for unreimbursed employee travel expenses for years 2018 to 2025. This would include unreimbursed mileage. Employers can reimburse employees for mileage at the standard mileage rate and are tax-free to the employee as long as accurate documentation is kept.*
To help pastors with mileage and other business expenses, churches should consider an accountable reimbursement plan to reimburse their pastor(s).
*The Board of Retirement does not provide tax advice. Consult your tax professional for tax consultation.