Rev. Proc. 84-72

SECTION 1. PURPOSE

The purpose of this revenue procedure is to update Rev. Proc. 82-61, 1982-2 C.B. 849, as modified by Rev. Proc. 83-74, 1983-2 C.B. 593, by stating that there have been no changes in the optional standard mileage rates for the business use of an automobile for 1984. The revenue procedure states that depreciation is considered to be allowed at 8 cents per mile for 1984 if the optional method for computing the costs of business use of an automobile is used.

SECTION 2. PROCEDURE

Paragraph (2)(b) of subsection .01 of section 3 of Rev. Proc. 82-61, which was modified by Rev. Proc. 83-74, is further modified to read as follows:

In the case of automobiles placed in service for business purposes after December 31, 1979, and in which the optional method was used in 1980, 1981, 1982, 1983, or 1984, depreciation will be considered to have been allowed at the rate of 7 cents per mile for 1980 and 1981, 7.5 cents per mile in 1982, and 8 cents per mile in 1983 and 1984, except that if the `actual cost` method was used for one or more of those years the rates above will not apply to any year in which that method was used. This depreciation will act to reduce the basis of the automobile in determining adjusted basis as required by section 1016 of the Code. An automobile placed in service after December 31, 1979, with respect to which the optional method is used is considered to have a useful life of 60,000 miles of business use at the maximum standard mileage rate determined without reference to the age of the vehicle. After 60,000 miles of business use at the maximum standard mileage rate, the automobile will be considered fully depreciated. For purposes of this paragraph, an automobile will be considered to have been driven no more than 15,000 miles in any one year, even though the actual business mileage of the automobile may be greater.

SEC. 3 EFFECT ON OTHER REVENUE PROCEDURES

Rev. Proc. 82-61, as modified by Rev. Proc. 83-74, is further modified.