January Newsletter

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Welcome to PayTech’s January Update

Market Update

As 2017 approaches, the IRS has announced the optional standard…click here to read more

Payroll Update

2017 Standard Mileage Rates for
Business, Medical and Moving Announced

WASHINGTON — The Internal Revenue Service today issued the 2017 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, 2017, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) will be:

  • 53.5 cents per mile for business miles driven, down from 54 cents for 2016
  • 17 cents per mile driven for medical or moving purposes, down from 19 cents for 2016
  • 14 cents per mile driven in service of charitable organizations

The business mileage rate decreased half a cent per mile and the medical and moving expense rates each dropped 2 cents per mile from 2016. The charitable rate is set by statute and remains unchanged.   The standard mileage rate for business is based on an annual study of the fixed and variable costs of operating an automobile. The rate for medical and moving purposes is based on the variable costs.

Taxpayers always have the option of calculating the actual costs of using their vehicle rather than using the standard mileage rates.

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 more than four vehicles used simultaneously.

These and other requirements are described in Rev. Proc. 2010-51. Notice 2016-79, posted today on IRS.gov, contains the standard mileage rates, the amount a taxpayer must use in calculating reductions to basis for depreciation taken under the business standard mileage rate, and the maximum standard automobile cost that a taxpayer may use in computing the allowance under a fixed and variable rate plan.

HR Update

Curious to know if your business is legally compliant in the new year? Check out the top 7 Latest Legal Trends in 2017 by clicking here.

Accounting Update

The new lease accounting rules, scheduled to take effect in 2019 for public companies and 2020 for private ones, will have far-reaching implications for both. The new standards, approved by both the U.S. Financial Accounting Standards Board (FASB) and the International Accounting Standards Board (IASB), require that leases with a maximum term longer than one year be capitalized on company balance sheets. Read More.

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