Bought a new SUV and want to know if you qualify for IRS mileage rates. Before that, let us learn what Standard Mileage Rates the Internal Revenue Service (IRS) sets. It can be defined as the default cost per mile fixed by the IRS for taxpayers. who can deduct the mileage expenses of their personal vehicle for business, medical or charitable purposes?

Say for example you have bought a new SUV at a price of $50,000, qualifying for both expensing and bonus depreciation under Section 179 of the IRC, and drove 15,000 miles in a year of which 87% are business miles, you can qualify for the IRS mileage rate. Let’s say you decide to sell the SUV after three years, put forth these three questions:

1. Would you cheat yourself by using the mileage rates?
2. If you cheated yourself, how badly did you cheat yourself?
3. Is there an easy way to know what’s best?

The answer is, yes you would cheat yourself in a pretty bad way with a loss of $6.215 in after-tax cash. If you want to know, what is the best use for the calculator, it helps achieve the following goals:

• It calculates the deduction, depreciation, and ownership cost as in Section 170 over the ownership period
• It calculates the mileage rate deductions over the ownership period
• It calculates the $9.788 IRS mileage rate depreciation residing within the mileage rate.
• It calculates the profit/loss on the sale
• Appropriate tax rates are applied to the profit/loss, compare the numbers and deliver a presentation on what is better and how much after-tax dollars you get.