The IRS on 2009 Mileage Rates

Here's the latest on IRS Mileage Rates for all you "Road Warriors" out there...

IRS Announces 2009 Standard Mileage Rates

IR-2008-131, Nov. 24, 2008 WASHINGTON: The Internal Revenue Service today issued the 2009 optional standard mileage rates used to calculate the deductible costs of operating an automobile for business, charitable, medical or moving purposes. Beginning on Jan. 1, 2009, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) will be: 55 cents per mile for business miles driven <>24 cents per mile driven for medical or moving purposes <>14 cents per mile driven in service of charitable organizations The new rates for business, medical and moving purposes are slightly lower than rates for the second half of 2008 that were raised by a special adjustment mid-year in response to a spike in gasoline prices. The rate for charitable purposes is set by law and is unchanged from 2008. The business mileage rate was 50.5 cents in the first half of 2008 and 58.5 cents in the second half. The medical and moving rate was 19 cents in the first half and 27 cents in the second half. The mileage rates for 2009 reflect generally higher transportation costs compared to a year ago, but the rates also factor in the recent reversal of rising gasoline prices. While gasoline is a significant factor in the mileage rate, other fixed and variable costs, such as depreciation, enter the calculation. A taxpayer may not use the business standard mileage rate for a vehicle after using any depreciation method under the Modified Accelerated Cost Recovery System (MACRS) or after claiming a Section 179 deduction for that vehicle. In addition, the business standard mileage rate cannot be used for any vehicle used for hire or for more than four vehicles used simultaneously. Taxpayers always have the option of calculating the actual costs of using their vehicle rather than using the standard mileage rates. Revenue Procedure 2008-72 contains additional information on these standard mileage rates.

Turn off the TV and Get out the broom for 2009…

As I watch the news every day on multiple national and international channels, the economy dominates all the stories. Doom and gloom! If I didn’t know better, I’d say that the media was trying to panic everyone.

And then I think about the Great Depression. The Great Depression was caused by panic.

We need to keep cool heads. We need to turn the televisions off, take a deep breath and get on with the business of business. If we let the messages of doom and gloom spook us and keep us from planning, doing and moving on, then we just might see another Great Depression. But if we keep on marching, and do a little common sense planning, we can get the economy back on track.

I’ve seen a few economic downturns and been laid off a few times. I guess that’s telling my age. One thing that mystifies me is how companies immediately cut the marketing budget when the economy stumbles. That’s short sighted! If we keep on advertising in bad times, when the good times come we’ll be ahead of our competition by a long shot. Historically, it's a proven fact.

We don’t have to indulge in conspicuous consumption to have a good life and a good economy. We need to sweep out the greed and do what makes sense. The object of the game is to make our companies viable for the long term, to make a fair profit and to provide jobs for people. And that means long term planning and not the short sighted daily or quarterly bottom line psychosis and panic over the latest economic news. So don’t cut your marketing. And do think about keeping your name out in front of people.

I’m turning off the television news and starting to positively plan my strategies for 2009. It’s going to be a great year!

I hope you will join me as I Blog my way through 2009. Carmen and I are also looking for Guest Bloggers and a Blog of the Month. Got a great Blog… let us know.

Season’s Greetings! Merry Christmas! Happy Chanukah! Fruitful Kwanza! And a happy, safe and profitable 2009!

Pat