Special Reportfull coverage America's cheapest gas is in this town Summer drivers to get a break on gas Why gas prices are likely to keep climbing You'll pay a little less for gas this summer Expect relief from record February gas prices Why gas prices are rising

NEW YORK (CNNMoney.com) - The Internal Revenue Service is scaling back its mileage deduction, which had received an unusual late-year bump when gasoline prices soared following Hurricane Katrina.

The tax agency will allow taxpayers to deduct 44.5 cents per mile for business miles driven. That's down eight percent from the rate for the last four months of this year, but up about 10 percent from the rate in effect before Katrina.

In addition, drivers will be able to deduct 18 cents per mile driven for medical or moving purposes and 14 cents per mile driven in service of most charitable organizations. The new rates take effect Jan. 1.

In September, the IRS set the rate for business miles to 48.5 cents per mile for the last four months of the year, after the nation's average gasoline price soared to a record high of $3.057. Gasoline is only part of what the agency considers when calculating the deduction, with maintenance and depreciation on the vehicle also factors.

Before the September adjustment, taxpayers could deduct 40.5 cents a mile driven for business purposes, 15 cents a mile for medical and moving expenses and 14 cents a mile for charitable service.

"The IRS took the extraordinary step of temporarily increasing the standard mileage rates in the aftermath of Hurricane Katrina," said a statement from IRS Commissioner Mark Everson. "We promised to continue closely monitoring the situation. The 2006 mileage rates reflect that gas prices have dropped."

Gasoline prices have dropped about 30 percent from their post-Katrina high, according to the latest survey by AAA, although prices are still 10 percent above year-earlier levels.

The standard mileage rates for business, medical and moving purposes are based on an annual study of the fixed and variable costs of operating an automobile, while the charitable mileage deduction

Congress has set special mileage rates for charitable work related to Hurricane Katrina relief that are higher than that for typical charitable driving.

For the latest on news on gasoline and oil prices, click here.