Starting July 1 you can deduct 58.5 cents per mile, when you’re driving for business, the IRS just announced. For miles driven between January 1 and June 30, 2008, you can deduct 50.5 cents per mile.

This is great news for the self-employed and those who get reimbursed for mileage by their employers.

The IRS normally does not make an adjustment in mid-year but they said the increase comes in response to recent higher gas prices. The agency also considers depreciation, insurance and other fixed and variable costs, it announced.

If you’re driving for a medical or moving purpose your mileage rate jumps to 27 cents from 19 cents. If you’re working for charity, the rate remains 14 cents per mile.

June 24, 2008.