2020  57.5 cents

2019  58.0 cents

2018   54.5 cents

2017  53.5 cents

2016  54.0 cents

Calculating your tax deduction using the standard mileage allowance rates is very simple.  Multiply your number of business-related miles by the rate shown above, then add your parking costs and bridge tolls.

Or, you can keep track of your actual expenses, including gas, repairs, insurance, and registration.  To that total, add depreciation, and then multiply the whole thing by your percentage of business use.  Percentage of business use is calculated by dividing your business miles by your total miles for the year. (Example:  If you drive 12,000 miles and 6,000 of those miles are for business, your business percentage is 50%.) Depreciation amounts depend on the value of the vehicle, the type of vehicle, the date first placed in service, and whether the vehicle is used more or less than 50% for business.

You can use whichever of these two methods gives you the larger tax deduction.  However, if you use the mileage allowance rates for the first year, you cannot claim depreciation in the following years.

In either case, you can also deduct the business percentage of the interest you pay on a car loan.

There are special rules for businesses which