IRS Mileage Rate 2026: 72.5 and 76 Cents Per Mile Explained

Quick answer: The IRS mileage rate for 2026 is 72.5 cents per business mile for driving from January 1 to June 30, 2026, and 76 cents per mile from July 1 to December 31, 2026, after a mid-year increase for fuel prices. The charitable rate is 14 cents, and the medical and military moving rate rose from 20.5 to 23.5 cents on July 1.

If you drive for your business, the IRS mileage rate 2026 is one of the simplest deductions you can claim, but this year it comes with a twist: two business rates in one tax year. This guide sets out every 2026 standard mileage rate, explains who can use it, walks through a worked example with real numbers and shows how to bill clients for travel on a clean line item using our free invoice generator.

Important: This is general information, not tax advice. Mileage rules differ for employees, rideshare drivers and fleet owners, so check the IRS guidance or a tax professional for your situation.

IRS mileage rate 2026: all standard rates at a glance

The IRS published the original 2026 rates in Notice 2026-10 in December 2025, then revised the business, medical and moving rates in Announcement 2026-11, effective July 1, 2026. As of 2026, the IRS standard mileage rates page lists the following:

Purpose	2025	Jan 1 to Jun 30, 2026	Jul 1 to Dec 31, 2026
Business (including self-employed)	70 cents	72.5 cents	76 cents
Medical	21 cents	20.5 cents	23.5 cents
Moving (active-duty military and certain intelligence community members)	21 cents	20.5 cents	23.5 cents
Charitable	14 cents	14 cents	14 cents

The charitable rate never moves with fuel prices because it is fixed by statute in section 170(i) of the tax code. The business rate is based on an annual study of the fixed and variable costs of running a vehicle, while the medical and moving rates use only variable costs such as fuel. The rates apply equally to gasoline, diesel, hybrid and electric cars, vans, pickups and panel trucks.

Why the rate changed on July 1

Announcement 2026-11 states plainly that the modification "results from recent increases in the price of fuel." The new figures apply to transportation expenses paid or incurred on or after July 1, 2026, and to employee mileage allowances paid on or after that date. Everything else in Notice 2026-10 stays in effect, including the depreciation component and the vehicle value limits covered below.

Who can use the standard mileage rate

The standard mileage rate is optional. It is a shortcut that replaces tracking every gas receipt, repair bill and insurance payment. You can use it if you are:

• Self-employed, including sole proprietors, freelancers, gig workers and single-member LLC owners who file Schedule C.
• A partner or business owner reimbursed by your company under an accountable plan.
• An employee in a qualifying group: Armed Forces reservists, fee-basis state or local government officials, certain performing artists and eligible educators.
• Anyone claiming medical or charitable miles, at those separate rates, if they itemize.

Most ordinary W-2 employees cannot deduct unreimbursed work mileage. Notice 2026-10 confirms that the One, Big, Beautiful Bill Act made the disallowance of miscellaneous itemized deductions permanent, so the right move for an employee is to ask for reimbursement rather than plan on a deduction.

When you cannot use the standard rate

IRS Publication 463 says you cannot use the standard mileage rate for a vehicle if you:

• Operate five or more cars for business at the same time, such as in fleet operations.
• Claimed depreciation using any method other than straight line for the car's estimated useful life, including MACRS.
• Claimed a Section 179 deduction or the special (bonus) depreciation allowance on the car.
• Claimed actual car expenses after 1997 for a car you lease.

For a car you own, you must choose the standard mileage rate in the first year the car is available for business use. After that, you can switch between methods year to year, though switching to actual expenses brings its own depreciation rules. For a leased car, choosing the standard rate locks you in for the whole lease. Our sibling guide on standard mileage vs actual expenses compares the two methods in depth.

What counts as business mileage

Only business miles qualify. The biggest trap is commuting: Publication 463 states that driving between your home and your main or regular place of work is a personal commuting expense, no matter how far it is or whether you take business calls on the way.

Miles that usually count include:

• Driving from your office to a client's site, job site or meeting.
• Trips to the bank, post office or supplier for business errands.
• Travel between two business locations on the same day.
• Driving from a qualifying home office that is your principal place of business to clients or temporary work sites.

On top of the standard rate, you can also deduct business-related parking fees and tolls. Self-employed owners can deduct the business portion of car loan interest and state or local personal property tax on the vehicle. You cannot add fuel, insurance, repairs or depreciation, because those are already built into the per-mile rate.

How to calculate your 2026 mileage deduction

Because 2026 has two business rates, the calculation has one more step than usual. Follow this process:

1. Total your business miles from January 1 to June 30, 2026 using your mileage log.
2. Multiply those miles by $0.725.
3. Total your business miles from July 1 to December 31, 2026.
4. Multiply those miles by $0.76.
5. Add business parking fees and tolls from your receipts.
6. Add the results and report the figure as car and truck expenses on Schedule C, with vehicle details in Part IV or on Form 4562.

Worked example: a consultant with 9,000 business miles

Dana is a self-employed IT consultant who visits client offices. Her 2026 log shows 4,200 business miles from January to June and 4,800 business miles from July to December. She also paid $210 in business parking and tolls.

Item	Calculation	Amount
January to June miles	4,200 x $0.725	$3,045.00
July to December miles	4,800 x $0.76	$3,648.00
Parking and tolls	From receipts	$210.00
Total vehicle deduction	$3,045 + $3,648 + $210	$6,903.00

If Dana had applied 72.5 cents to all 9,000 miles, she would have claimed $6,525 for mileage instead of $6,693, leaving $168 of deduction unclaimed. Using 76 cents for the full year would overstate it by $147. The split matters, which is why dated log entries are essential.

Dana also needs to reduce her car's tax basis. Notice 2026-10 says 35 cents of every 2026 business mile is treated as depreciation, so her basis drops by 9,000 x $0.35 = $3,150. That figure does not change her deduction this year, but it affects the gain or loss when she later sells or trades in the car.

Records the IRS expects you to keep

The standard mileage rate saves you from keeping fuel and repair receipts, but it does not remove the need for records. Publication 463 says you need adequate, timely records to prove the business use of your car. A good log includes:

• The date of each trip.
• The starting point and destination.
• The business purpose, such as "site visit, Smith kitchen remodel."
• Miles driven, from odometer readings or a GPS app.
• Odometer readings on January 1 and December 31, so you can show total and business miles.

Record trips as they happen or at least weekly. A log rebuilt from memory at tax time is far weaker in an audit. Keep the log and parking receipts with your other tax records; our guide on how long to keep invoices and records covers retention periods. If you also track other costs, the business expense tracking guide shows how to keep everything in one system.

Mileage reimbursement: employers and clients

Reimbursing employees

Whether to reimburse mileage is largely up to the employer, though some states require reimbursement of necessary work expenses. When a business reimburses employees at or below the IRS rate under an accountable plan, with the employee substantiating the trips, the reimbursement is generally not taxable wages. For allowances paid on or after July 1, 2026, the ceiling under the standard rate is 76 cents. Allowances paid for trips before that date use 72.5 cents.

Notice 2026-10 also sets the maximum standard automobile cost for fixed and variable rate (FAVR) plans, and the maximum value of employer-provided cars for the cents-per-mile valuation rule, at $61,700 for 2026.

Billing clients for mileage on an invoice

Freelancers, contractors and consultants often pass travel costs to clients. Using the IRS rate keeps the charge easy to justify. Agree it in your contract or estimate first, then bill it as its own line rather than burying it in your fee:

• Description: "Business mileage, Aug 4 to Aug 29, client site visits"
• Quantity: 320 miles
• Rate: $0.76
• Amount: $243.20

For travel before July 1, use $0.725 if your agreement ties the charge to the IRS rate. Our guide to reimbursable expenses on an invoice explains whether to mark up pass-through costs and how to show them for sales tax. Mileage you bill is income to you, and you still deduct your own business miles, so the two do not cancel out on your return.

Truckers and delivery businesses usually price differently, per load or per route, rather than per mile at the IRS rate.

Standard mileage vs actual expenses in 2026

The higher 2026 rate makes the standard method more generous than in past years, but actual expenses can still win for expensive, heavily used or inefficient vehicles. Here is a quick comparison:

Factor	Standard mileage rate	Actual expenses
Recordkeeping	Mileage log, parking and toll receipts	Mileage log plus every vehicle receipt
Best for	Efficient, low-cost or electric cars, high mileage	Costly vehicles, high insurance or repairs, low mileage
Depreciation	Built in (35 cents per mile for 2026)	Claimed separately, subject to limits
Fleet of five or more	Not allowed	Allowed
Flexibility later	Can switch to actual in a later year	Usually locked in if MACRS or Section 179 used

To decide, total what you actually spent on the car in a year, multiply by your business-use percentage and compare it to your mileage figure. Mileage is just one line among your self-employed tax deductions, and lower taxable profit also lowers your self-employment tax, so the choice matters more than it looks.

Where mileage fits in your wider tax picture

Your mileage deduction reduces Schedule C profit, which in turn reduces both income tax and self-employment tax. To see what bracket that saving lands in, see our sibling guide to the 2026 tax brackets and standard deduction. If your mileage figure is large, factor it into your quarterly estimated tax payments so you do not overpay during the year.

New business owners setting up their books may also want our list of business expense categories, which shows where car costs sit alongside travel, supplies and software.

Bill your mileage the right way

The IRS mileage rate 2026 is 72.5 cents per mile for January to June and 76 cents per mile for July to December, so split your log at June 30 and apply the right rate to each half. Keep dated trip records, add parking and tolls separately and reduce your car's basis by 35 cents per business mile.

When you pass travel costs on to clients, show miles, rate and dates as their own line. Create a US invoice with a mileage line in minutes, or start from the corporate invoice template. Ready to bill? Open the invoice generator and download a professional PDF free.