Certain members of Congress have taken it upon themselves to encourage the IRS to make a mid-year adjustment in the standard mileage rate used for deductions and reimbursements. This wouldn't be the first time the IRS stepped up and lowered the rate when prices at the pump escalated. With gas prices hovering around $4.00 per gallon, it would seem reasonable to assume that the IRS will make a mileage rate adjustment this summer. I can remember two such increases in the past decade. But so far, the IRS is not acquiescing.
Last week an agency representative gave a thumbs down to the idea of an increase. Does this mean the IRS knows something we don't know about where gas prices are going? Or is it truly just too much of a "logistical challenge" to change the rate, as the IRS representative stated? From a gas-using taxpayer perspective, the mid-year rate change seemed fairly unchallenging and certainly very welcome in the past. The last time gas prices were this high, the IRS changed the mileage rate to 58.5 cents per gallon. It's time to recognize that the higher gas prices are likely to stick around for awhile, and that the mileage rate should reflect this.
Gail Perry, editor-in-chief