The Internal Revenue Service has announced that the optional standard mileage rate for employees who use their own cars for business purposes will increase to 51 cents per mile on Jan. 1, 2011. The new rate compares with a rate of 50 cents per mile for 2010.

Employers who use the standard mileage rate to reimburse employees may deduct the reimbursement as a business expense. The rate is based on an annual study of the fixed and variable costs of operating an automobile.

Also for 2011, the standard mileage rate for miles driven for medical or moving purposes will be 19 cents, up from 16.5 cents, and the rate for miles driven in service of charitable organizations will remain unchanged at 14 cents

For more information on mileage rates, see Revenue Procedure 2010-541.