Mileage Rates Change July 1St,2011

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Discussion Overview

The thread discusses the recent changes to IRS mileage rates effective July 1, 2011, and how participants are managing their mileage tracking and tax reporting in relation to these updates.

Discussion Character

  • Anecdotal, Opinion-based, Technical explanation

Main Points Raised

  • One participant shares information from their tax advisor about the new IRS mileage rates for business, moving, medical, and charitable use.
  • Another participant expresses gratitude for the information, indicating it was previously unknown to them.
  • One participant mentions that they usually find out about mileage rates at the end of the year but appreciates the advance notice this time.
  • Several participants discuss their methods for tracking mileage, including using P3 and exporting data to other software like Quicken or TurboTax.
  • One participant describes their process of calculating mileage using mapping services and keeping printed results for potential audits.
  • Another participant asks for clarification on how to update the mileage rate in P3, indicating some confusion about the process.
  • One participant notes that they do not change the tax rate in P3, as they rely on TurboTax to calculate deductions based on entered mileage.

Areas of Agreement / Disagreement

Views differ on whether to update the mileage rate in P3, with some participants opting to do so while others do not see the need. There is no clear consensus on the best method for tracking mileage.

Contextual Notes

Participants share personal experiences and methods related to tracking mileage for tax purposes, reflecting a variety of approaches and tools used within the community.

Who May Find This Useful

Consultants looking for insights on managing mileage tracking and tax reporting may find the shared experiences and methods relevant.

esavvymom
esavvymom
Staff member
Messages
7,881
Just got this info from "my" tax-guy:

*****************

NOW IT IS OFFICIAL!

Later this week you will read in the papers that the IRS will increase vehicle-use rates as of July 1.

The NEW rates will be 55.5¢ per mile for Business use, 23.5¢ per
mile for Moving or Medical use, and 14¢ (unchanged) for charitable use.

The first half of 2011, ‘OLD’ rates were 51.0¢ per mile for business use,
19.0¢ per mile for moving or medical use, and 14¢ for charitable use.

CAUTION: THE NEW RATES ARE NOT ‘RETROACTIVE’

  • All business use during the first half of 2011 will be deductible at the “old” rates.
  • Separately, all business-use miles after June 30, will be deductible at the “new” rates.
 
Thanks for letting us know, didn't know that.
 
  • Thread starter
  • #3
I usually don't know until the end of the year when I enter my tax info/deductions, because I look it up. But I got advance warning this year. :D So figured it would save some time by entering it into P3 correctly from July 1st forward! ;)
 
Bobbi,

Do you get all your numbers for tax time from P3 or do you export it to something like Quicken?
 
Thank you!
 
  • Thread starter
  • #6
chefa said:
Bobbi,

Do you get all your numbers for tax time from P3 or do you export it to something like Quicken?
Click to expand...

Do you mean do I use P3 for tracking my expenses? Yes. Then I run a report and hand it to my DH who does taxes with Turbotax. As far as how do I know the rate, normally I just google it when I start entering the mileage, but I took a tax course for home business and I still get emails from him.
 
Thanks for the info!!! Every little bit helps, especially where taxes are concerned.
 
I am in the spot to edit the categories but how exactly do we put 55.5? My old rate was showing as .51. Was that correct? Do we just change it to .55? An accountant, I am not!
 
  • Thread starter
  • #10
In P3, go to the Income/Expense, or just click on the button to Add a New Expense/Income item. Then click on "Edit Categories". That is where you can add new categories, make changes, etc. Click on the one for Mileage. You'll be able to adjust the rate there. It will then input the correct amount for all entries going forward.
 
I figured out where to change it but not how to change it to 55.5? I'll have to mess with it tomorrow or sometime soon. I don't want to forget to do it.
 
  • Thread starter
  • #12
Teresa LM said:
I figured out where to change it but not how to change it to 55.5? I'll have to mess with it tomorrow or sometime soon. I don't want to forget to do it.
Click to expand...

If you follow the steps I gave you, it will take you to the place you need to change it. You just change the mileage rate number to reflect the new one. It will affect all entries going forward.

Good luck!
 
esavvymom said:
If you follow the steps I gave you, it will take you to the place you need to change it. You just change the mileage rate number to reflect the new one. It will affect all entries going forward.

Good luck!
Click to expand...

While I do enter my miles in P3 and print off the expense report for reference and recordkeeping, I never bother changing the tax rate $ amount in P3. When I do the taxes (we use turbotax) I just enter in the mileage. The program calculates the amount the deduction is. I haven't seen a need to worry about it.
 
Teresa LM said:
I am in the spot to edit the categories but how exactly do we put 55.5? My old rate was showing as .51. Was that correct? Do we just change it to .55? An accountant, I am not!
Click to expand...

Just type in three 5's after the decimal point.
.555

I like it being in P3 because of the nice year-end report P3 can do for income & expenses.
 
Thank you ShellBeach. That's what I ended up doing, hoping it was right. I have been trying to put everything into P3 also. Do you all put the actual odometer reading or are you just putting in the miles? I've been doing the odometer but it's kind of a pain to remember to write it down.
 
What I have done for the last 6 years is I go out to Yahoo maps or Map Quest, type in the beginning,(mine), and ending,(Host), addresses and print the results. I then pop them into a folder. Each map tells you how many miles. I simply double that when I record the miles in P3. My tax guy at H&R Block says they are submittable to the IRS if you get audited. (and I never have been) So I do not keep an odometer log. You,re right in that it is a royal pain.
 

Frequently Asked Questions

What was the mileage rate change effective July 1, 2011?

The mileage rate change effective July 1, 2011, was an adjustment made by the IRS to the standard mileage rate for business use of a vehicle. The rate was increased to 55.5 cents per mile, up from 51 cents per mile that was in effect earlier in the year.

Why did the IRS change the mileage rate in July 2011?

The IRS adjusts the mileage rate periodically to reflect changes in the cost of operating a vehicle, including factors like fuel prices, maintenance, and depreciation. The increase in July 2011 was primarily due to rising fuel costs at that time.

How does the mileage rate change affect direct sellers like Pampered Chef consultants?

For direct sellers, including Pampered Chef consultants, the mileage rate change affects how they can deduct vehicle expenses when filing taxes. Consultants can use the updated rate to calculate deductions for business-related travel, which can help reduce their taxable income.

What records should Pampered Chef consultants keep to claim mileage deductions?

Pampered Chef consultants should maintain a detailed log of their business-related travel, including the date, purpose of the trip, starting and ending locations, and the total miles driven. Keeping accurate records is essential for substantiating mileage deductions during tax filing.

Can Pampered Chef consultants choose between the standard mileage rate and actual expenses for deductions?

Yes, Pampered Chef consultants can choose between using the standard mileage rate or deducting actual vehicle expenses. However, if they opt for the standard mileage rate, they must use it for the entire year once they start using it for a vehicle. It's important to evaluate which method provides a larger deduction based on individual circumstances.

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