Beginning January 1, 2007, the optional standard mileage rates used to calculate the deductible costs of operating an automobile for business will increase by 4 cents, to 48.5 cents per mile. The mileage rate for medical and moving purposes increases 2 cents, to 20 cents per mile driven. These standard mileage rates apply to cars, vans, pickups and panel trucks.

The standard business mileage rate can not be used for any vehicle after any depreciation method under the Modified Accelerated Cost Recovery System (MACARS) is applied, a Section 179 deduction is claimed for that vehicle, a vehicle is used for hire or for more than four vehicles used simultaneously. Revenue Procedure 2006-49 contains additional information on these standard mileage rates.

The standard mileage rate for a vehicle driven in service of a charitable organization has been set at 14 cents for 2007, according to the IRS. The mileage rate for charitable miles is set by statute. The 14 cents per mile rate was put in place last year after Hurricane Katrina and codified in the Katrina Emergency Tax Relief Act of 2005 (Katrina Act) which was signed into law by President Bush on September 23, 2005.