IRS Mileage Rate 2026: How to Claim the Mileage Deduction

The 2026 rates changed on July 1

The IRS sets a standard mileage rate each year, and in 2026 it changed mid-year. The business rate is 72.5¢ per mile for January 1 through June 30 and 76¢ per mile for July 1 through December 31. The rate for medical travel, and for moving by active-duty Armed Forces members under orders, is 20.5¢ and then 23.5¢. The charity rate is set by statute and stays at 14¢ all year.

The practical consequence: you have to know how many miles you drove in each half of the year, not just the annual total. A log with nothing but a December odometer reading cannot be split. The mileage deduction calculator takes miles for each period and does the math, and the IRS posts the current rates on its standard mileage rates page.

Who can use the standard mileage rate

The rate is for people who deduct vehicle costs on their own return: self-employed workers and independent contractors filing Schedule C, which includes rideshare and delivery drivers, and landlords driving to their rentals on Schedule E. If you are a W-2 employee, current federal law does not let most employees deduct unreimbursed business miles; the deduction for unreimbursed employee expenses was suspended starting in 2018 and the suspension was later made permanent. The exceptions are narrow: Armed Forces reservists, qualified performing artists and fee-basis state or local officials.

What employees can get is reimbursement. When your employer pays you back for business miles at or below the IRS rate under an accountable plan (you substantiate the miles and return any excess advance), the money is not taxable wages. Anything paid above the rate is wages. You also cannot use the standard rate if you run five or more vehicles at the same time, or if you already took accelerated depreciation or a Section 179 deduction on the car.

Standard mileage or actual expenses

The standard rate stands in for the actual cost of gas, oil, tires, repairs, insurance, registration, lease payments and depreciation. You cannot take both. Under the actual method you add all of those up and multiply by the share of the year's miles that were business miles. The rate is simpler and tends to win for older, efficient, high-mileage cars; actual expenses tend to win for an expensive vehicle driven fewer miles, mostly because of depreciation.

The choice has a first-year rule. For a car you own, you must use the standard rate in the first year the car is used for business to keep the option of switching between methods later. Start with actual expenses in year one and you are locked into actual expenses for that car. For a leased car, choosing the standard rate commits you to it for the whole lease. Either way you need total miles for the year, because Schedule C asks for them.

What counts as a business mile

Commuting between home and a regular workplace is never deductible, no matter how far it is or what you carry in the truck. Business miles are trips between job sites, to a customer or supplier, to the bank or post office on business, and to a temporary work location. For gig drivers, miles between pickups while you are logged in and available are business miles. Be careful with the first and last leg of the day: if your home is your principal place of business (a qualifying home office), the drive from home to the first job is business; if not, that leg can be commuting. Personal errands folded into a business trip are personal miles.

The log the IRS expects

For vehicles the IRS is specific about records: for each business trip, the date, destination, business purpose and miles, written down at or near the time of the trip. A log reconstructed from memory in March is the kind that loses an audit. You also need the odometer reading at the start and end of the year, because Schedule C asks for total miles, business miles and commuting miles. Keep the records for at least three years after you file. A GPS app that logs every drive and lets you tag it business or personal covers all of this with no typing.

Parking fees and tolls paid on business trips are deductible on top of the standard rate. Parking at your regular workplace is commuting and is not.

What it saves: a worked example

A self-employed driver logs 12,000 business miles in 2026, 6,000 in each half of the year. The deduction is 6,000 × $0.725 = $4,350 plus 6,000 × $0.76 = $4,560, for $8,910. Because the deduction comes off Schedule C net profit, it lowers both income tax and self-employment tax. In the 22% bracket that is roughly $1,960 of income tax and about $1,260 of self-employment tax (15.3% of 92.35% of the deduction), around $3,200 in all before the small adjustment for the deductible half of SE tax. Add $300 of business tolls and parking and the deduction is $9,210. The self-employment tax calculator shows the full tax picture, and the gig driver profit calculator shows what a week of driving nets after the car.

These are estimates of federal tax; state treatment varies, and if your situation has more to it than a car and a Schedule C, talk to a tax professional. RideLedger records every drive automatically and keeps the per-period miles and the log the IRS asks for.