Cost per mile driven

[John Greenstreet <jgreenst@motown.ge.com>]

> From quattro-owner@swiss.ans.net Sat Dec  3 23:48:09 1994
> Date: Sat, 3 Dec 1994 23:26:44 -0500
> From: Nivi@aol.com
> To: quattro@swiss.ans.net
> Subject: Euro-lights: S2 Style
> Reply-To: quattro@swiss.ans.net
> 
> 
> PS: I think that one is only allowed to deduct between $ 0.33 to $ 0.37 per
> mile for tax purposes here in the US. 

I am not aware of any such limit, and I don't believe the IRS is
either, as I have been audited twice (both times their mistake, not
mine or my accountant's), and neither time has there been a problem
with deducting around 80 cents per mile.  Heck, in New Jersey, it's
fairly average to have insurance alone account for 20 cents per mile.
To get to 10 cents/mile depreciation-wise, you'd have to drive a
$20,000 car 200,000 miles.  Add in the opportunity cost of the car's
equity, tyres, maintenance, fuel, oil, washing, waxing, etc. and the
cost per mile of even an average car is well over 40 cents per mile
if driven the average of 15 K miles/year.

Analyses that come up with a cost per mile of much less than 40 cents
are probably omitting something, or looking at too short of a time
period; e.g., the car's tyres may need replacement but that cost is not
added in, or similarly with other wear items.  Remember that all a car's
wear items need to be depreciated as well as the car itself.

My brother drives beaucoup miles per year as a networking consultant,
and I looked at all options for him in regards to driving 35K + per
year with minimum downtime (at around $100/hour billable rate, who
wants to be delayed with car trouble?).  The best deal was a short-term
car lease and going way over the mileage limit, because the lease
company only charges 10 cents a mile for each mile over the limit.  He
will then turn the car in (a 93 Audi 100S) at the end of the lease and
get a new one, rather than keeping it, because to get to 10 cents per
mile average (depreciation-wise), he'd have to keep this $30,000 car
for 300,000 miles, and then he'd *probably* have some maintenance
expenses.  By doing this his overall cost is around 40 cents/mile
including absolutely everything.

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John Greenstreet, Senior Engineer           (jgreenst@motown.ge.com)
Martin Marietta Government Electronic Systems    Moorestown NJ 08057
WPI Class of '75, Temple Class of '94

My new car history:
  1975    1978    1982       1986        1989      1992      1995
   VW ->  Audi -> Audi  -> Mercedes -> Mercedes -> Audi -> Mercedes
Scirocco Fox GTI  4000S    190E 2.3    190E 2.6    100CS     S320

POSSLQ's* new car history:
         1978       1981       1985      1988        1990     1993
       Triumph ->  Toyota ->  Toyota  ->  VW    ->   Audi  -> Audi
       Spitfire    Tercel     Corolla   Jetta GL      80      90S

*POSSLQ = Person of Opposite Sex Sharing Living Quarters
Note: All Audis and Mercedes above were sold to friends or family.
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