IRS Mileage Rate 2026

The IRS has released the 2026 standard mileage rate: 72.5 cents per mile, a 2.5-cent increase from 70 cents in 2025. Issued in IR-2025-128 on December 29, 2025, the rate applies to the business use of personal vehicles (cars, vans, pickups, and panel trucks, including fully electric and hybrid vehicles). It will take effect on January 1, 2026.

Mileage rates 2026 vs 2025

While the business mileage rate has increased, to the highest it's ever been, the medical and moving rate has been reduced by a half cent from 2025. Take a look to see how the rate has changed over the years. 

For further reading, see the IRS Notice IR-2025-128, published Dec. 29, 2025.

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How to apply the business mileage rate

Self-employed (1099)

As a self-employed individual who drives for business, you can claim a tax deduction on your business vehicle expenses using the standard mileage rate set by the IRS, or apply the actual expenses method. The choice will largely depend on your vehicle and how much you drive in a tax year. 

Our self-employed mileage guide is a good place to start, if you want the rules explained in detail. 

Employees (W-2)

If you’re an employee driving a personal vehicle for work, your employer can choose to apply the standard mileage rate to reimburse you for all business-related driving. 

They can, however, reimburse you at a rate lower than the one set by the IRS. Bear in mind that if you get reimbursed at a rate higher than the standard mileage rate, it’s considered taxable income. 

Also read: Are Employee Reimbursements Taxable? 

Note: According to the Tax Cuts and Jobs Act 2017, most W-2 employees can't deduct unreimbursed expenses on their tax return. This law has recently been made permanent for most workers. Consult your individual case with your employer or accountant. 

You can find out more about mileage reimbursement rules for employees in our guide.

How to calculate my reimbursement or tax deduction? 

By multiplying the miles driven by the standard mileage rate, you can estimate your mileage reimbursement. For a quick calculation, use our free IRS mileage calculator.

Here's an example:

Your logs show you've driven 170 miles for business. The 2026 standard mileage rate is 72.5 cents per mile. 

To find your reimbursement, you multiply the number of miles by the rate:

[miles] * [rate], or 170 miles * $0.725 = $123.25

How are the mileage rates determined?

The IRS business mileage rate is reviewed annually and updated to reflect the current costs of owning and operating a vehicle in the U.S. 

The business mileage rate factors in both fixed and variable vehicle expenses. In contrast, the mileage rates for medical and moving purposes are calculated using only variable costs.

Fixed costs include expenses such as:

• Insurance
• Registration and licensing fees
• Lease payments
• Vehicle depreciation

Variable costs cover expenses like:

• Fuel or charging costs
• Parking
• Oil
• Tire replacements
• General maintenance

The charitable mileage rate is set by law and has not changed since 1998.

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