The IRS mileage rate is a tax construct that is designed to capture the actual operational cost of a vehicle. It sounds like you have some sort of magical car that doesn’t need maintenance, doesn’t depreciate, and doesn’t have wear and tear parts like tires that need replacing.I don't have a car payment, and even if I construed an opportunity cost payment representing what I spent on the car it would come nowhere close to the $600 I saved.Not to mention “cutting your travel costs in half” is a month’s car payment.No, because flying costs $600 that I could save by driving. If I fly the car just sits in the garage while I'm gone. Remember, sunk costs don't count. As soon as I need a car for any other purpose, ie. going to work, etc. then flying is not an alternative to the car payment.Unless you’re doing that 12 times a year, it’s better on net to fly.IRS millage is a tax code construct, like many things in the tax code it does not necessarily make sense in the real world. And for the purpose of calculating the marginal cost of me driving it is especially inaccurate. It does not cost me anywhere close to the IRS mileage to drive a marginal mile, and most of the variable costs outside of fuel are so small as to be negligible. So yes, fuel is actually a good proxy for a quick calculation.The math is also pretty lousy. Use the IRS mileage rate to get closer to true costs, rather than “we spent X on fuel.”
Statistics: Posted by beardsicles — Thu Apr 11, 2024 3:09 pm — Replies 58 — Views 3892
