2025 Standard Mileage Rates Announced

Affordable Tax & Accounting

As it does every year, the Internal Revenue Service recently announced the inflation- adjusted 2025 optional standard mileage rates used to calculate the deductible costs of operating an automobile for business, charitable, medical, or moving purposes.

Beginning on Jan. 1, 2025, the standard mileage rates for the use of a car (or a van, pickup or panel truck) are:

• 70 cents per mile for business miles driven (including a 33-cent-per-mile allocation for depreciation). This is up from 67cents per mile in 2024; 
• 21 cents per mile driven for medical, down from 22 cents per mile same as 2024; and
• 14 cents per mile driven in service of charitable organizations.

The business standard mileage rate is based on an annual study of the fixed and variable costs of operating an automobile. The rate for medical and moving purposes is based on the variable costs as determined by the same study. The rate for using an automobile while performing services for a charitable organization is statutorily set (it can only be changed by Congressional action) and has been 14 cents per mile for over 25 years.

When using a personal vehicle while performing services for a charitable organization, and instead of using the 14 cents a mile method, a taxpayer who itemizes their deductions can deduct directly-related out-of-pocket expenses, such as the cost of gas and oil. However, the expenses of general repair and maintenance, depreciation, registration fees, or the costs of tires or insurance aren’t deductible.

Important Considerations for Business Use of a Vehicle – Taxpayers always have the option of calculating the actual costs of using their vehicle for business rather than using the standard mileage rates. In addition to volatile fuel prices, the bonus depreciation as well as increased depreciation limitations for passenger autos may make using the actual expense method worthwhile during the first year a vehicle is placed in business service. While the bonus depreciation rate had been 100% during 2018-2022, it was 80% for 2023, 60% for 2024 and will be 40% for vehicles put in service in 2025.

However, the standard mileage rates cannot be used if you have used the actual method (using Sec. 179, bonus depreciation and/or MACRS depreciation) in previous years. This rule is applied on a vehicle-by-vehicle basis. In addition, the business standard mileage rate cannot be used for any vehicle used for hire or for more than four vehicles simultaneously.

What business owners using the standard mileage rate frequently overlook is that parking and tolls, as well as state and local property taxes paid for the vehicle and attributable to business use, may be deducted in addition to the standard mileage rate.

Employer Reimbursement – When employers reimburse employees for business-related car expenses using the standard mileage allowance method for each substantiated employment-connected business mile, the reimbursement is tax-free if the employee substantiates to the employer the time, place, mileage and purpose of employment-connected business travel.

The Tax Cuts and Jobs Act eliminated employee business expenses as an itemized deduction, effective for 2018 through 2025. Therefore, during these years employees may not take a deduction on their federal returns for unreimbursed employment-related use of their autos, light trucks, or vans.

However, self-employed taxpayers can still deduct the business use of a vehicle. Regardless of whether the standard mileage rate or actual expense method is used, a self-employed taxpayer may also deduct the business use portion of interest paid on an auto loan on their Schedule C.

Faster Write-Offs for Heavy Sport Utility Vehicles (SUVs) – Many of today’s SUVs weigh more than 6,000 pounds and are therefore not subject to the limit rules on luxury auto depreciation; taxpayers with these vehicles can utilize both the Section 179 expense deduction (up to a maximum of $31,300 in 2025)  and the bonus depreciation (the Section 179 deduction must be applied before the bonus depreciation) to produce a sizable first-year tax deduction. However, the vehicle cannot exceed a gross unloaded vehicle weight of 14,000 pounds. Caution: Business autos are 5-year class life property. If the taxpayer subsequently disposes of the vehicle before the end of the 5-year period, as many do, a portion of the Section 179 expense deduction will be recaptured and must be added back to the taxpayer’s income (SE income for self-employed individuals). The future ramifications of deducting all or a significant portion of the vehicle’s cost using Section 179 should be considered.

If you have questions related to the best methods of deducting the business use of your vehicle or the documentation required, please give this office a call.

2024 Post Election Analysis: Impact on Business, Healthcare and Care Delivery in the Home

 Axxess / By Janice Mitchell, Communications Specialist

President-elect Donald Trump’s election has the potential to bring significant changes to the government’s healthcare policy over the next four years. The care at home industry could be impacted by the policies of a second Trump administration.

Deborah Hoyt, Senior Vice President of Public Policy at Axxess, led a post-election webinar with Dr. Steve Landers, President and CEO of the National Alliance for Care at Home; Andrew Woods, Chairman of Liberty Partners Group; Ander Crenshaw, Senior Advisor at King & Spalding; and E.J. Dionne, Senior Fellow at the Brookings Institution.

The panel discussed the implications of the election results on home-based care and its role in shaping future healthcare debates.

Affordable and Quality Healthcare

It is important to provide affordable and quality healthcare services. The panelists emphasized the potential of home-based care to create value, save money for the healthcare industry and maintain patients’ dignity and independence.

“Every American deserves good, quality healthcare in the place they prefer most, which is their own homes,” said Hoyt.

Crenshaw emphasized that home care can solve the healthcare crisis. “This is one of the ways that both solves the crisis in terms of access and a way to lower the cost,” said Crenshaw. “This is an area where you can still deliver quality healthcare and make it less expensive.”

Address Regulatory and Legislative Issues

The panelists discussed the regulatory and legislative issues that need to be addressed in the care at home industry. It is important to have a supportive and accommodating government that can help the sector grow without imposing unnecessary regulatory constraints.

Woods pointed out the impact of certain regulatory measures on the sector. “Here’s a way we can nearly solve two problems for the price of one, that is the access problem as well as the cost problem,” said Woods.

He explained that regulatory relief is needed in the current Congress to ensure that the care at home industry can thrive and meet the need for accessible care options.

Landers stressed the need for the government to support the industry. “Our members [providers] need to be supported. They’re a national treasure. Our sector is a national treasure. It’s a strategic asset especially for an aging nation,” said Landers.

Future of Home Care in the Healthcare Debate

Debates about healthcare will have a significant impact on the future of the care at home industry.

“The combination of long-term care and home care is definitely on the table for our future,” explained Dionne.

With healthcare reform likely on the agenda in the next Congress, the care at home industry could be positioned at the center of debates about Medicare, long-term care and reimbursement structures.

Panelists agreed that home care is a bipartisan issue with strong support across the political spectrum, making it a potential area of collaboration between parties.

Crenshaw mentioned that the new government might bring in individuals who understand market-driven economies and could see home healthcare as a solution to the healthcare crisis.

“I think he [President-elect Trump] will bring in some really good people and I think in that sense, we’ll be able to see some of the savings that we’re talking about and the increase in quality that we’re talking about,” explained Crenshaw.

With both political parties recognizing the value of care in the home, the opportunity for reforms that streamline reimbursement processes and expand access to services is within reach.

By focusing on cost-effective solutions and maintaining the dignity of patients, home-based care could play a transformative role in reshaping healthcare delivery for the future.

Axxess’ cloud-based software solutions provide healthcare organizations with a comprehensive technological infrastructure, empowering them to deliver exceptional patient care and achieve sustainable success.

HHS Issues Proposed Rule to Modify HIPAA Security Rule

Alliance Daily

On Friday, December 27, the U.S. Department of Health and Human Services (HHS) Office of Civil Rights released a Notice of Proposed Rulemaking to amend the Health Insurance Portability and Accountability Act of 1996 (HIPAA) Security Rule. This proposed rule would propose significant changes intended to improve cybersecurity standards for the protection of electronic protected health information (ePHI). This is in response to an evolving healthcare landscape, characterized by an alarming increase in cyberattacks and cybersecurity breaches occurring nationwide in the healthcare sector. HHS has published a press release and fact sheet with information on topline proposals accompanying the proposed rule. Comments on the proposed rule are due March 7, 2025.

The Security Rule,[1] part of the HIPAA regulations,[2] was initially published in 2003 and last modified in January 2013. It creates standards for protecting the confidentiality and integrity of ePHI, and applies to covered entities—including health plans, healthcare clearinghouses, and healthcare providers—that create, receive, maintain, or transmit ePHI.

The proposed rule addresses significant changes in technology, changes in breach trends and cyberattacks, HHS’ Office for Civil Rights’ (OCR’s) enforcement experience, and other guidelines, best practices, methodologies, procedures, and processes for protecting ePHI. In addition, the proposed rule addresses the following topics, including a request for comments in each section:

• Updating Definitions: The proposed rule clarifies and updates terminology used in a non-exhaustive list of examples of electronic storage material, including preparing for future technology. It also includes updates to reflect the role of emerging technologies, such as artificial intelligence (AI) and quantum computing in data security.

• Security Standards: HHS proposes improving consistency of language between the Security Rule and other sections of HIPAA, by including more flexibility and scalability.

• Administrative Safeguards: HHS proposes to update policies and procedures for the management and execution of security measures, including requirements for risk analyses that incorporate testing and evaluation of security measures.

• Physical Safeguards: The proposed rule would modify Security Rule physical safeguard standards and addresses recent case law regarding steps to protect confidentiality, integrity, and available of ePHI.

• Technical Safeguards: The proposed rule aims to improve guidance to ensure covered entities are adequately implementing, reviewing, and updating their policies and procedures, and includes, among other things, requirements for encryption and multi-factor authentication (MFA) to safeguard ePHI.

• Organizational Requirements: HHS proposes adding additional requirements to business associate agreements and when to activate contingency plans, to address risk trends and contingency planning for data breaches and service interruptions.

• Documentation Requirements: HHS proposes to delete and modify documentation requirements to align with administrative, physical, and technical safeguards changes throughout this proposed rule by requiring written documentation to be in electronic form. In addition, the rule would modify specifications for documentation time limits, availability, and updates.

• Transition Provisions: HHS proposes to remove compliance date information in 45 CFR 164.318 and replace this language for transitioning to the revised Security Rule, if finalized.

• New and Emerging Technologies Request for Information (RFI): HHS is requesting information on quantum computing, AI, virtual and augmented reality (VR and AR) and its impact on the Security Rule.  

The Alliance is working on a more detailed breakdown of the proposed rule as well as scheduling opportunities for members to provide feedback. If you have feedback or questions, please reach out to [email protected].

The Top 10 Home Health Care News Stories Of 2024

Home Health Care News / By Joyce Famakinwa
 
Major deals hit snags. Home health cuts continued. Regulatory noise came in from all sides, in Medicare and in Medicaid. All of those realities made their way into Home Health Care News’ most popular stories for the year. In order to summarize the 2024 that providers had, HHCN is revisiting 10 of its most widely read stories.
 
1. Home Care Industry Slams Finalized 80-20 Rule, Warns Agency Closures Are Coming (April 22)
  
2. Court Orders VitalCaring to Share 43% of Profits With Encompass Health, Enhabit (December 3)
   
3. How The Supreme Court’s Chevron Decision Could Help Stop Home Health Cuts (June 28)
 
4. DOJ Sues To Block ‘Anticompetitive and Illegal’ UnitedHealth Group-Amedisys Deal (November 12) 
  
5. Home Care’s Industry-Wide Turnover Rate Reaches Nearly 80% (July 3)
 
6. The Looming Home Care Disaster In New York State (March 18) 
  
7. ‘We Need A Break, Please!’: Home Health Providers Sound Off On CMS Over Rate Cuts (October 11)
 
8. Enhabit Walks Away From UnitedHealthcare After ‘9 Months Of Unsuccessful Negotiations’ (August 7) 
 
9. 6 Home Care Leaders To Watch, According To Other Home Care Leaders(January 29)
  
10. Pinnacle Home Care CEO: Home Health Margins Will Increase ‘Significantly’ With AI (October 22)