Business Mileage Rates Raised for 2026

The IRS has increased the optional standard mileage rate used to calculate the deductible costs of operating an automobile for business purposes in 2026.

Beginning Jan. 1, 2026, the standard mileage rates for the use of a car, van, pickup, or panel truck will be:

• 72.5 cents per mile driven for business use, up 2.5 cents from 2025
• 20.5 cents per mile driven for medical purposes, down a half cent from 2025
• 20.5 cents per mile driven for moving purposes for certain active-duty members of the Armed Forces and intelligence community, down a half cent from last year
• 14 cents per mile driven in service of charitable organizations, equal to the rate in 2025

The rates apply to electric and hybrid-electric vehicles and gasoline and diesel-powered vehicles.

The standard mileage rate for business use is based on an annual study of the fixed and variable costs of operating an automobile.

The rate for medical and moving purposes is based on the variable costs.

Requirements

Taxpayers cannot claim a miscellaneous itemized deduction for unreimbursed employee travel expenses.

Taxpayers also cannot claim a deduction for moving expenses, unless they are members of the Armed Forces or a certain member of the intelligence community moving under orders to a change of station or assignment.

If taxpayers chose to use standard mileage rates, they must opt to do so in the first year the car is available for business use.

If taxpayers chose to use standard mileage rates, they must opt to do so in the first year the car is available for business use. They can choose either the standard mileage rate or actual expenses in the years that follow.

Taxpayers can calculate the actual costs of using their vehicle, rather than using standard mileage rates. 

Leased vehicles must use the standard mileage rate method for the entire lease period (including renewals) if the standard mileage rate is chosen.