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IRS Mileage Reimbursement Rate for 2016 Decreases to 54 Cents

Press Release.

12.18.2015

Runzheimer Data Informs Lower IRS Business Mileage Rate, 54 Cents for 2016

With cents-per-mile rate at its lowest in 5 years, gas prices only part of the equation

WATERFORD, Wis. – December 18, 2015 – Using data from Runzheimer, a business vehicle program, relocation  information services and expense management solutions provider, the Internal Revenue Service (IRS) has announced the new national, optional business mileage deduction rate of 54 cents for U.S. business drivers, effective January 1, 2016. 

The IRS has used Runzheimer vehicle cost data to help calculate its mileage deduction rate since 1980, referencing a broad array of fixed and variable factors, including vehicle depreciation, auto insurance premiums and maintenance rates. Runzheimer also provides similar benchmarking information to private organizations, as well as technology and consulting services around business vehicle reimbursement, expense management and relocation.

The 2016 rate reflects a 3.5 cent decrease from the current rate of 57.5 cents-per-mile, which went into effect January 1, 2015. This is just the sixth time it has fallen more than half of a cent year over year in the last 25 years. The IRS also calculates standard rates for driving for other work-related purposes, such as moving. That standard rate for relocation-related mileage is 19 cents-per-mile.

"Falling oil and gas prices certainly play a role in calculating the IRS mileage reimbursement rate, but there is a lot more contributing to the full picture,” said Heidi Skatrud, SVP of Operations and Product Management at Runzheimer. “By extensively researching the factors and conditions impacting the modern business driver, our goal is to give the IRS and other businesses an informed perspective to help them make evidence-supported decisions.”

The new standard mileage rate is the amount a U.S. taxpayer and companies are able to deduct on a 2016 tax return for recorded business miles in a personal vehicle. 

About Runzheimer

Runzheimer is the recognized leader in business vehicle technology and solutions mileage management, providing actionable insight into field workforce productivity. We are dedicated to offering innovative solutions that increase agility, reduce costs and improve satisfaction through fair, accurate and defensible™ vehicle reimbursement programs. Our technology produces data analytics that enable organizations to manage mobile workers through a streamlined process that eliminates excessive overhead costs. It is our mission to offer mobile technology and solutions that connect people, companies and their vehicles to drive superior productivity and valuable business intelligence.