2026 IRS Mileage Reimbursement Rate: Everything You Need to Know

2026 IRS Mileage Reimbursement Rate – The IRS mileage reimbursement rate is a crucial figure for taxpayers, self-employed individuals, and businesses tracking vehicle expenses. For 2026, the Internal Revenue Service has updated these rates to reflect changes in fuel costs, vehicle maintenance, and other operating expenses. Whether you’re deducting business miles, medical travel, or charitable contributions, understanding the 2026 IRS standard mileage rates can help you maximize your tax savings and stay compliant.

In this comprehensive guide, we’ll break down the new rates, explain how they work, compare them to previous years, and provide tips on using them effectively for your tax filings.

What Are IRS Standard Mileage Rates?

The IRS standard mileage rates provide a simplified way to calculate deductible vehicle expenses without tracking every receipt for gas, repairs, and depreciation. Instead of itemizing actual costs, taxpayers can multiply the standard rate by the number of qualifying miles driven during the year.

These rates apply to:

  • Business use (e.g., driving for work as a self-employed person or reimbursing employees).
  • Medical or moving purposes (with specific eligibility rules).
  • Charitable contributions (volunteer driving for qualified organizations).

The IRS typically announces updates in late December for the following year, based on an annual study of fixed and variable vehicle costs. For 2026, the rates take effect for expenses incurred on or after January 1, 2026.

2026 IRS Mileage Rates Breakdown

Here’s a detailed look at the 2026 standard mileage rates:

Business Mileage Rate

  • Rate: 72.5 cents per mile.
  • Applies to: All miles driven for business purposes, such as client meetings, deliveries, or commuting between job sites (note: regular home-to-office commuting doesn’t qualify).
  • Key Notes: This rate includes a depreciation component of 35 cents per mile, which reduces the vehicle’s basis for tax purposes. It cannot be used for unreimbursed employee travel expenses, except for specific cases like educators, reservists, or certain government officials.

Medical and Moving Mileage Rate

  • Rate: 20.5 cents per mile.
  • Applies to: Travel for medical care (e.g., doctor visits) or qualified moving expenses.
  • Key Notes: Moving deductions are generally disallowed except for active-duty military members or certain intelligence community personnel relocating due to job changes. Always verify eligibility under IRS sections 213 and 217.

Charitable Mileage Rate

  • Rate: 14 cents per mile.
  • Applies to: Miles driven while providing services to a qualified charitable organization (e.g., delivering meals for a nonprofit).
  • Key Notes: This rate is set by statute and remains unchanged from prior years. It only covers out-of-pocket vehicle expenses for volunteer work.

Additionally, for fixed and variable rate (FAVR) allowance plans or employer-provided vehicles:

  • Maximum standard automobile cost: $61,700.
  • Maximum fair market value for valuation rules: $61,700.

How Do the 2026 Rates Compare to 2025?

The 2026 business mileage rate represents a 2.5-cent increase from the 2025 rate of 70 cents per mile, reflecting rising costs in fuel and vehicle ownership. The medical/moving rate decreased slightly from 21 cents in 2025 to 20.5 cents, while the charitable rate holds steady at 14 cents.

This adjustment helps taxpayers keep pace with inflation and economic shifts. For context:

  • 2025 Rates: Business (70 cents), Medical/Moving (21 cents), Charitable (14 cents).
  • 2024 Rates: Business (65.5 cents), Medical/Moving (21 cents), Charitable (14 cents).

Over the past few years, business rates have trended upward due to volatile gas prices and supply chain issues affecting vehicle costs.

How to Use the IRS Mileage Reimbursement Rate for Taxes?

To claim the standard mileage deduction:

  1. Track Your Miles: Use a mileage tracking app, logbook, or odometer readings to record qualifying trips. Include date, purpose, and miles driven.
  2. Choose Your Method: You can opt for the standard rate or actual expenses (e.g., gas, tolls, insurance)—but you must pick one per vehicle for the year. The standard method is simpler for most.
  3. File Appropriately: Report on Schedule C (for self-employed), Form 2106 (for certain employees), or Schedule A (for medical/charitable if itemizing).
  4. Reimbursements: If you’re an employer, use these rates as a benchmark for tax-free employee reimbursements. Amounts above the rate may be taxable.

Switching between methods? You can only do so if you used the standard rate in the vehicle’s first year of business use. Consult a tax professional for complex situations.

Pros and Cons of Using Standard Mileage Rates

Pros:

  • Simplifies record-keeping—no need for detailed expense receipts.
  • Often higher deduction for low-maintenance vehicles or short trips.
  • Adjustable annually by the IRS for economic accuracy.

Cons:

  • May understate deductions if your actual costs (e.g., high gas prices) exceed the rate.
  • Depreciation limits apply, affecting future vehicle sales.
  • Not available for fleets of five or more vehicles used simultaneously.

For high-mileage drivers, calculating actual expenses might yield better results—run the numbers both ways.

Frequently Asked Questions (FAQs) About 2026 IRS Mileage Rates

What is the 2026 IRS mileage rate for business?

The rate is 72.5 cents per mile for business use starting January 1, 2026.

Can I use the standard mileage rate for my electric vehicle?

Yes, the rates apply to all automobiles, including EVs. However, you can’t claim additional EV tax credits on top of the standard deduction.

How does the IRS calculate these rates?

The IRS bases rates on an annual study of costs like fuel, depreciation, insurance, and maintenance, adjusted for inflation.

What if I drive for ridesharing like Uber?

Rideshare miles qualify as business use at 72.5 cents per mile, but personal miles (e.g., commuting to your pickup area) don’t.

Are there penalties for incorrect mileage claims?

Yes—keep accurate records for at least three years, as the IRS may audit claims. Substantiation is key to avoiding fines.

Final Thoughts on 2026 IRS Mileage Reimbursement

The 2026 IRS mileage rates offer a straightforward path to deducting vehicle expenses, with the business rate rising to 72.5 cents to account for higher costs. By staying informed and maintaining good records, you can optimize your tax strategy and potentially save hundreds or thousands on your return.

Always check the official IRS website for the latest updates, and consider consulting a CPA for personalized advice. If you’re planning your 2026 budget, factor in these rates to ensure accurate reimbursements and deductions.