Federal and state governments both set standard mileage rates for business travel every year. While some states set their own mileage rate, Illinois uses the same rate the federal government does. If you live in Illinois, you must use the federal rate (50.5 cents as of 2011) when claiming a deduction for business travel on your state taxes.
Illinois complies with the federal standard mileage rate, so employees must use the same rate for Illinois tax purposes as for federal tax purposes. For example, the federal standard mileage rate as of April 2011 is 50.5 cents per mile. Thus, employees in Illinois may deduct 50.5 cents per mile from their taxes for business travel and employers must use this rate when reimbursing employees for business travel.
Employees may only deduct mileage if they use their vehicles in the course of employment. Traveling back and forth between the employee's home and the place of business does not count toward the business mileage tax deduction. If the employee drives from the business to the post office, bank or any other business as part of his job duties, those miles count toward the mileage reimbursement, as does travel to training sites.
The main purpose of the standard mileage rate is to determine how much employees may deduct from their federal and state taxes for business travel. Since Illinois uses the same standard mileage rate as the federal government, employees must deduct the same amount for mileage from their federal and state taxes. Employers may also use the standard mileage rate to determine the reimbursement rate if they reimburse employees for business travel.
The federal government determines its standard mileage rate based on the average costs of owning and operating vehicles, such as the average price of gas, cost of wear-and-tear on a vehicle and registration and licensing fees. The federal government re-examines these costs and sets a new rate each year. As of 2011, employee travel is worth 50.5 cents per mile, while miles driven for the purpose of moving or providing medical care have a rate of 19 cents per mile and driving for charity has the rate of 14 cents per mile.
- Central Management Services: Travel Update #09-06: Mileage Reimbursement for the Use of Personal Vehicles
- Human Resources Management Services: 2011 IRS Mileage Rate Sees Slight Increase
- Internal Revenue Service. "IRS issues standard mileage rates for 2020." Accessed Feb. 3, 2020.
- Internal Revenue Service. "Standard Mileage Rates." Accessed Feb. 3, 2020.
- Cision PR Newswire. "Runzheimer Data Sets 2017 IRS Business Mileage Rate at 53.5 Cents." Accessed Feb. 3, 2020.
- U.S. Government Publishing Office. "H. R. 606." Accessed May 1, 2020.
- Internal Revenue Service. "Publication 463 Travel, Gift, and Car Expenses," Pages 13-15. Accessed Feb. 3, 2020.
- Internal Revenue Service. "Publication 526 Charitable Contributions," Page 6. Accessed Feb. 3, 2020.
Jack Ori has been a writer since 2009. He has worked with clients in the legal, financial and nonprofit industries, as well as contributed self-help articles to various publications.