Law Office of Camron Hoorfar, PC

The Internal Revenue Service has announced an increase in the optional standard mileage rate for the final 6 months of 2022. Taxpayers may use the optional standard mileage rates to calculate the deductible costs of operating an automobile for business and certain other purposes.

For the final 6 months of 2022, the standard mileage rate for business travel will be 62.5 cents per mile, up 4 cents from the rate effective at the start of the year. The new rate for deductible medical or moving expenses (available for active-duty members of the military) will be 22 cents for the remainder of 2022, up 4 cents from the rate effective at the start of 2022. These new rates become effective July 1, 2022. The IRS provided legal guidance on the new rates in Announcement 2022-13.

In recognition of recent gasoline price increases, the IRS made this special adjustment for the final months of 2022. The IRS normally updates the mileage rates once a year in the fall for the next calendar year. For travel from Jan. 1 through June 30, 2022, taxpayers should use the rates set forth in Notice 2022-03.

“The IRS is adjusting the standard mileage rates to better reflect the recent increase in fuel prices,” 
said IRS Commissioner Chuck Rettig. “We are aware a number of unusual factors have come into play involving fuel costs, and we are taking this special step to help taxpayers, businesses and others who use this rate.” 

While fuel costs are a significant factor in the mileage figure, other items enter into the calculation of mileage rates, such as depreciation and insurance and other fixed and variable costs. 

The optional business standard mileage rate is used to compute the deductible costs of operating an automobile for business use in lieu of tracking actual costs. This rate is also used as a benchmark by the federal government and many businesses to reimburse their employees for mileage. 

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

The 14 cents per mile rate for charitable organizations remains unchanged as it is set by statute.

Midyear increases in the optional mileage rates are rare, the last time the IRS made such an increase was in 2011.

Have tax questions? Call our office at 816-524-4949 or click here to schedule a consultation.

Families of the victims of the collapse of the Champlain Towers South condominium in Surfside, Fla., that killed 98 people last year have reached a $997 million settlement to compensate them for their staggering losses of life.

If you or someone close to you has been injured in an accident, you may be entitled to compensation as well. Call our office at 816-524-4949 to schedule a consultation.

A federal appeals court recently ruled that payments individuals owe to the Internal Revenue Service for failing to obtain health insurance under the Affordable Care Act should be given priority in bankruptcy.

If you need tax assistance or are considering bankruptcy, call our office at 816-524-4949 or click here to schedule a consultation.

Coinbase has warned users that their cryptocurrency could be at risk if the exchange ever went bankrupt. The cryptocurrency exchange included a new disclosure to its customers in its first-quarter earnings report. “Because custodially held crypto assets may be considered to be the property of a bankruptcy estate, in the event of a bankruptcy, the crypto assets we hold in custody on behalf of our customers could be subject to bankruptcy proceedings and such customers could be treated as our general unsecured creditors,” the warning states. This is a statement Coinbase needed to make because of a requirement made by the U.S. Securities and Exchange Commission, which said these disclosures are necessary so that customers are informed about their investments. Founder and chief executive of Coinbase Brian Armstrong took to Twitter to reassure customers that the company was not at risk of bankruptcy. “Your funds are safe at Coinbase, just as they’ve always been,” he wrote. “We have no risk of bankruptcy, however we included a new risk factor based on an SEC requirement called SAB 121, which is a newly required disclosure for public companies that hold crypto assets for third parties.”

Considering bankruptcy? Call our office at 816-524-4949 or click here to schedule a free consultation to discuss your options.

The Justice Department has launched its first criminal prosecution involving the alleged use of cryptocurrency to evade U.S. economic sanctions. In an unusual nine-page opinion, U.S. Magistrate Judge Zia M. Faruqui of Washington, D.C., explained why he approved a Justice Department criminal complaint against an American citizen accused of transmitting more than $10 million worth of bitcoin to a virtual currency exchange in one of a handful of countries comprehensively sanctioned by the U.S. government: Cuba, Iran, North Korea, Syria or Russia. In the ruling, the judge called cryptocurrency’s reputation for providing anonymity to users a myth. He added that while some legal experts argue that virtual moneys such as bitcoin, ethereum or Tether are not subject to U.S. sanctions laws because they are created and move outside the traditional financial system, recent action taken by the Treasury Department’s Office of Foreign Assets Control require federal courts to find otherwise.

If you’re interested in speaking with an attorney, call our office at 816-524-4949 or click here to schedule a consultation.