Wednesday, Sept. 18, 2002 | 9:45 a.m.
WASHINGTON -- Lower prices at gasoline pumps will mean lower tax deductions for business use of a car in 2003, the Internal Revenue Service said.
The tax agency lowered the standard mileage deduction to 36 cents per mile from 36.5 cents per mile this year for cars operated as part of a business. Costs for cars used for medical reasons or calculating deductible moving expenses dropped to 12 cents per mile from 13 cents. Mileage accumulated while volunteering at a charity remains at 14 cents.
"The primary reason for the mileage rate decreases is the decline in fuel prices," the IRS said in a statement. The change is effective Jan. 1, 2003.
The national average retail price of regular unleaded gasoline was $1.401 per gallon this week, according to an Energy Department survey. That is 12.8 cents lower than a year ago, the weekly survey of about 900 filling stations showed.
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