IRS mileage rate 2026: 72.5¢, then 76¢ from 1 July

#The 2026 rates

Purpose	1 Jan – 30 Jun 2026	1 Jul – 31 Dec 2026	2025, for comparison
Business	72.5¢ per mile	76¢ per mile	70¢
Medical or military moving	20.5¢	23.5¢	21¢
Charitable	14¢	14¢	14¢

The business rate is the one most people mean. It applies to a car, van, pickup or panel truck you own or lease, when you choose the standard mileage method instead of adding up actual costs.

#Why there are two rates this year

The IRS sets the business rate from a study of the fixed and variable costs of running a car. Normally it publishes one figure in December and leaves it alone for twelve months. When costs move sharply inside a year it can issue a mid-year adjustment — it did so in 2022, and it has done so again in 2026, raising the business rate by 3.5 cents from 1 July.

The practical consequence is simple and easy to get wrong: the rate that applies is the one in force on the day of the trip. A drive on 28 June is worth 72.5 cents a mile. The same drive on 2 July is worth 76. When you file in 2027, you split the year at 30 June and apply each rate to its own half.

Applying one rate across the whole year is wrong in both directions — you either shortchange yourself on the second half, or overclaim on the first. Either way it is the first number an examiner checks.

#Calculator: your 2026 deduction

Parking and tolls paid on business trips are not in the rate. Add them separately, with the receipt.

#What the rate includes, and what it does not

The standard rate is designed to stand in for the whole cost of operating the vehicle. That means it already covers:

• Fuel and oil
• Maintenance, repairs and tires
• Insurance and registration
• Depreciation (a fixed portion of each mile is treated as depreciation)

So there is no adding fuel receipts on top of the rate. People do, and it is one of the more common errors on a Schedule C. What you can add is business-related parking and tolls, which Publication 463 treats as separate deductible expenses.

#What counts as a business mile

Driving between two places of work, from your office to a client, to the bank or the post office on business, between job sites, and — for a delivery or rideshare driver — the miles between accepting jobs, all count. Commuting does not: the trip from home to your regular place of work is personal, whatever you are carrying and whatever you are thinking about on the way.

If your home is your principal place of business, trips from home to a client or supplier are business miles. That single rule is worth more to most freelancers than any app.

#Standard rate or actual expenses

Method	What you track	Tends to win when
Standard mileage	Business miles × the rate for the period, plus parking and tolls	The car is inexpensive to run, or you want the simplest record that stands up
Actual expenses	Fuel, insurance, repairs, lease or depreciation — multiplied by your business-use percentage	The car is expensive, heavily used for business, or newly bought

There is a sequencing rule. If you want the standard rate for a car you own, you must choose it in the first year that car is used in your business; you can move to actual expenses later. Start with actual expenses and you generally cannot go back to the standard rate for that vehicle. Choose deliberately in year one.

Whichever method you use, the mileage log is not optional. Actual expenses needs the business-use percentage, and that comes from the same miles.

#The record that makes the number real

A rate is worthless without the miles behind it, and the IRS is specific about what the record must show for each trip: the date, the destination, the business purpose, and the miles — kept at or near the time of the trip, not rebuilt in April. The full rules are in what the IRS requires in a mileage log, and there is a free template with the right columns if you would rather keep it by hand.