Last updated: October 18, 2026 · By the Flex Tax and Consulting Group team
If you drive for your business, the IRS gives you two ways to calculate mileage for taxes: the standard mileage rate or the actual expense method. For 2026, the business standard mileage rate is 72.5 cents per mile for miles driven January 1 through June 30, and 76 cents per mile from July 1 through December 31, after a mid-year increase by the IRS. This guide explains how to calculate mileage for taxes with each method, who can claim it, and what records you need.
Who can deduct business mileage?
- Self-employed people and business owners who use a vehicle for business can deduct mileage, usually on Schedule C (or on Schedule E for rental property travel).
- Most W-2 employees cannot deduct unreimbursed mileage on their federal return. That deduction was eliminated starting in 2018, with limited exceptions such as Armed Forces reservists and certain performing artists and fee-basis government officials.
- California is different. California still allows unreimbursed employee business expenses as an itemized deduction, subject to its own limits.
Commuting between your home and a regular workplace is personal and never deductible, whichever method you use.
2026 standard mileage rates
| Purpose | Jan 1 – Jun 30, 2026 | Jul 1 – Dec 31, 2026 | 2025 |
|---|---|---|---|
| Business | 72.5¢ | 76¢ | 70¢ |
| Medical / military moving | 20.5¢ | 23.5¢ | 21¢ |
| Charitable | 14¢ | 14¢ | 14¢ |
Method 1: How to calculate mileage with the standard rate
Multiply your business miles by the rate in effect when you drove them. Because the 2026 rate changed mid-year, split your 2026 miles into two periods.
Example: You drive 3,000 business miles from January to June and 2,000 from July to December. Your 2026 deduction is (3,000 × $0.725) + (2,000 × $0.76) = $2,175 + $1,520 = $3,695. You can also deduct business parking fees and tolls on top of the standard rate.
To use the standard rate for a car you own, you generally must choose it in the first year the car is used for business. For a leased car, you must use it for the entire lease period.
Method 2: How to calculate mileage with actual expenses
Add up the year’s total vehicle costs, then multiply by your business-use percentage.
- Costs include gas, oil, repairs, tires, insurance, registration, lease payments and depreciation.
- Business-use percentage = business miles ÷ total miles for the year.
Example: Your vehicle costs total $12,000 and you drove 15,000 miles, 6,000 of them for business (40%). Your deduction is $12,000 × 40% = $4,800. Depreciation on vehicles is subject to annual limits, and switching methods later has restrictions.
Which method is better?
The standard rate is simpler and works well for fuel-efficient cars and high mileage. The actual expense method can produce a larger deduction for vehicles with high costs, such as expensive repairs, insurance or a newer vehicle with large depreciation. Many people calculate both in the first year before choosing. A tax professional can help you weigh the options for your situation.
Records you need
The IRS requires a written log made at or near the time of each trip. Record the date, destination, business purpose and miles for each trip, plus your odometer readings at the start and end of the year. A mileage app works if it captures the same details. Without a log, the deduction can be disallowed in an audit.
Keep business miles driven separate from personal miles. Commuting from home to a regular workplace counts as personal, not business. A mileage log (paper or a mileage tracking app) is also how you show the business-use share of a car you use for both. Self-employed people claim mileage deductions on Schedule C, together with other car and truck expenses. Whichever method you use, the standard mileage deduction or actual expenses, the log is what supports the number on your tax return.
The IRS sets the standard mileage rate each year, with separate rates for business travel, medical or moving purposes (moving applies only to certain active-duty military), and charitable driving. Many employers use the IRS business rate as their mileage reimbursement rate, but they are not required to.
FAQ
What is the IRS mileage rate for 2026?
For business driving, 72.5 cents per mile from January 1 to June 30, 2026, and 76 cents per mile from July 1 to December 31, 2026.
Can I deduct mileage if my employer doesn’t reimburse me?
Generally not on your federal return if you’re a W-2 employee. You may be able to deduct it on your California return if you itemize.
Is driving to see clients deductible?
Yes, travel between your business location and a client’s location is business mileage. Driving from home to your regular office is commuting.
Sources
IRS: Standard mileage rates · IRS Publication 463. Last reviewed October 18, 2026.
Questions about vehicle expenses for your business? See our business tax services or book a call.
General information only, not tax advice for your situation.