2021 Standard Mileage Rates

 The rate for 2021 decreased to 56 cents per mile from 57.5 cents in 2020. This rate is used to calculate the tax deduction for using a car for your business. Medical care mileage is now 16 cents per mile and charitable mileage remains unchanged at 14 cents per mile. The IRS will disregard mileage estimates for your business upon audit. They are looking for a contemporaneous written record of business mileage. If you have significant business mileage, you should consider getting a mileage log at an office supply store to document your mileage. You can also document business mileage in your quickbooks. 

Estate Taxes

 The estate tax exclusion has increased to $11.7 million from $11.58 million in 2021. This amount is scheduled to drop back to $5 million adjusted for inflation on 1/1/2026. This is estimated to be between $6 million and $7 million. If you have an estate of $6 million or more, consideration should be given to making a portability election on form 706 to transfer a deceased spouse's unused exclusion to the surviving spouse prior to 2026. 

2020 Tax Organizers

 You should have already received the 2020 tax organizer from me either by regular mail or email. I send them to all my individual clients, but do not send out organizers to dependents, corporations, fiduciaries, or partnerships. Please let me know if you have not received your tax organizer yet. Thank you.

Meals Tax Deduction

 For 2021 and 2022, the law has been changed to allow for a 100% deduction of business meals. In 2020, you were only allowed a 50% tax deduction for business meals. This change was put in by the President to help the struggling restaurant industry.