The IRS mileage rate for 2026 is 72.5 cents per mile for business driving — up 2.5 cents from 2025. If you’re self-employed, a freelancer, or an independent contractor who drives for work, this rate determines how much you can deduct on your tax return.
At 10,000 business miles, the standard mileage deduction equals $7,250. At 20,000 miles, it’s $14,500. Missing just 100 miles per month in tracking costs you over $870 per year in lost deductions.
Here’s everything you need to know about the 2026 IRS mileage rate — including all rate categories, who can claim the deduction, how to calculate your savings, and the recent OBBBA changes that permanently changed who qualifies.
2026 IRS Standard Mileage Rates
The IRS announced the 2026 standard mileage rates in IRS Notice 2026-10, released on December 29, 2025. These rates apply to all driving from January 1 through December 31, 2026.
| Purpose | 2026 Rate (per mile) | Change from 2025 |
|---|---|---|
| Business | 72.5 cents | +2.5 cents |
| Medical | 20.5 cents | -0.5 cents |
| Moving (military only) | 20.5 cents | -0.5 cents |
| Charity | 14 cents | No change |
Of the 72.5 cents per mile business rate, 35 cents is attributable to depreciation (up from 33 cents in 2025). The rates apply equally to gasoline, diesel, hybrid, and fully electric vehicles — there’s no separate rate for EVs.
The charitable mileage rate of 14 cents per mile is set by federal statute and can only be changed by Congress. It hasn’t changed in years.
How Much You Can Save With the 2026 Mileage Deduction
The value of your mileage deduction depends entirely on how many business miles you drive. Here’s what the 2026 rate means at different mileage levels:
| Annual Business Miles | 2026 Deduction (72.5¢/mi) | 2025 Deduction (70¢/mi) | Extra Savings in 2026 |
|---|---|---|---|
| 5,000 | $3,625 | $3,500 | $125 |
| 10,000 | $7,250 | $7,000 | $250 |
| 15,000 | $10,875 | $10,500 | $375 |
| 20,000 | $14,500 | $14,000 | $500 |
| 30,000 | $21,750 | $21,000 | $750 |
For self-employed individuals, the mileage deduction reduces both your income tax and your self-employment tax — making it one of the most valuable tax deductions for freelancers.
The average self-employed mileage deduction is approximately $5,500 per year. Gig workers who drive full-time often log 500+ miles per week, which translates to roughly $18,850 per year in deductions at the 2026 rate.
Who Can Claim the Mileage Deduction in 2026
The One Big Beautiful Bill Act (OBBBA), signed in 2025, permanently changed who can deduct business mileage. Here’s the current breakdown:
Can Deduct Mileage
- Self-employed / sole proprietors — Deduct on Schedule C. Reduces both income tax and self-employment tax.
- Independent contractors / 1099 workers — Same as self-employed.
- Gig workers (Uber, Lyft, DoorDash, Instacart) — Classified as independent contractors.
- Single-member LLC owners — Deduct on Schedule C.
- Partners in partnerships — Deduct on Schedule E or as unreimbursed partner expenses.
Cannot Deduct Mileage
- W-2 employees — The TCJA suspended unreimbursed employee expense deductions from 2018-2025. OBBBA made this suspension permanent. W-2 employees can never deduct business mileage on their personal tax returns.
- Important: This was originally set to expire after 2025 and be reinstated in 2026, but OBBBA eliminated it permanently.
- Alternative for employees: Seek reimbursement through your employer’s accountable plan, which is tax-free to you and deductible by the employer.
What Miles Are Deductible (and What Aren’t)
Not every mile you drive counts as a business mile. Understanding the distinction is critical to claiming a legitimate deduction.
Deductible Business Miles
- Driving from your office to a client meeting
- Trips to the bank, post office, or supplier for business purposes
- Travel between two work sites during the day
- Driving from your home office to a business location (if you have a qualifying home office)
- Trips to temporary work locations
- All miles driven while on business travel (out-of-town trips)
- For gig workers: miles to pickup location, with passengers/deliveries, and between rides
Non-Deductible Miles
- Commuting — Driving from home to your regular workplace is never deductible, regardless of distance
- Personal errands, even if done during the workday
- Driving to lunch (unless a business meal with a client)
Home office exception: If you have a qualifying home office, your home IS your principal place of business. Every trip from home to a client, supplier, or business location becomes deductible — including trips that would otherwise be considered commuting.
Standard Mileage Rate vs. Actual Expenses
The IRS gives you two methods to deduct vehicle expenses. The standard mileage rate is simpler, but the actual expense method can sometimes produce a larger deduction.
| Factor | Standard Mileage Rate | Actual Expenses |
|---|---|---|
| Calculation | Business miles × 72.5¢ | Total vehicle costs × business % |
| Simplicity | Very simple | Complex — track ALL costs |
| Best for | High-mileage, low-cost vehicles | Low-mileage, expensive vehicles |
| Can switch later? | Yes — can switch to actual | No — locked in permanently |
| Extra deductions | Parking + tolls on top | Included in total expenses |
Critical switching rule: If you choose the standard mileage rate in year one, you can switch to actual expenses later. But if you choose actual expenses first, you’re locked in permanently for that vehicle. Most tax professionals recommend starting with the standard mileage rate to preserve flexibility.
IRS Mileage Rate History (2020-2026)
| Year | Business Rate | Medical/Moving Rate | Charity Rate |
|---|---|---|---|
| 2026 | 72.5¢ | 20.5¢ | 14¢ |
| 2025 | 70¢ | 21¢ | 14¢ |
| 2024 | 67¢ | 21¢ | 14¢ |
| 2023 | 65.5¢ | 22¢ | 14¢ |
| 2022 (Jul-Dec) | 62.5¢ | 22¢ | 14¢ |
| 2022 (Jan-Jun) | 58.5¢ | 18¢ | 14¢ |
| 2021 | 56¢ | 16¢ | 14¢ |
| 2020 | 57.5¢ | 17¢ | 14¢ |
The business rate has increased steadily since 2021, reflecting rising vehicle operating costs including fuel, insurance, and maintenance.
How to Track Business Mileage
The IRS requires five elements for every deductible business trip (per IRS Publication 463):
- Date of the trip
- Destination (starting and ending points)
- Mileage (exact miles driven)
- Business purpose (must be specific)
- Odometer readings at the beginning and end of each tax year
Logs must be created at or near the time of travel — not reconstructed months later. The easiest way to meet this requirement is with a mileage tracker app that automatically records your trips via GPS.
Digital mileage logs are fully accepted by the IRS, as long as they contain all five required elements. Records must be retained for at least 3 years from your filing date (7 years if you claimed a loss).
Don’t Forget the Receipts Between the Miles
The mileage deduction covers your per-mile operating costs. But parking fees and tolls are deductible on top of the standard mileage rate. And if you use the actual expense method, you’ll need receipts for gas, insurance, repairs, and maintenance.
Either way, tracking your vehicle-related receipts alongside your mileage gives you a more complete picture of your total vehicle deductions. An expense tracker with built-in mileage tracking captures everything in one place — so nothing falls through the cracks at tax time.
SparkReceipt’s AI receipt scanner already handles your gas station receipts, parking charges, and toll receipts automatically. Mileage tracking is coming soon — join the waitlist to be the first to know when it launches.
IRS Mileage Rate 2026 FAQ
What is the IRS mileage rate for 2026?
The IRS standard mileage rate for 2026 is 72.5 cents per mile for business driving, 20.5 cents for medical and moving (military only), and 14 cents for charity. The business rate increased 2.5 cents from 2025.
Can W-2 employees deduct mileage in 2026?
No. The OBBBA permanently eliminated unreimbursed employee expense deductions, including mileage, for W-2 employees. Only self-employed individuals, freelancers, and independent contractors can deduct business mileage. Employees should seek reimbursement through their employer’s accountable plan instead.
Is there a limit on how many miles I can deduct?
No. The IRS does not cap the number of deductible business miles. All legitimately documented business miles qualify for the deduction at the standard mileage rate. The only requirement is that every trip is properly logged with date, destination, mileage, and business purpose.
Can I deduct mileage AND gas expenses?
Not with the standard mileage rate — gas costs are already factored into the 72.5 cents per mile. However, you CAN deduct parking fees and tolls on top of the standard rate. If you use the actual expense method instead, you deduct gas, insurance, repairs, depreciation, and all other vehicle costs based on your business-use percentage.
Disclaimer: This article is for informational purposes only and does not constitute tax advice. Consult a qualified tax professional for guidance on your specific situation.
