IRS Updates Mileage Tax Rates For 2026: What You Need to Know
TRENDING: Student Loan Debt in 2026
The IRS is offering major tax breaks for certain expenses in 2026. Here’s what you need to know:
People who use their cars for work will now be able to deduct more money per mile on their taxes this year.
This week, the IRS announced that the standard mileage rate for business driving per mile will increase by 2.5 cents, while the rate for vehicles used for medical purposes will decrease by half a cent. According to the agency, this reflects “updated cost data and annual inflation adjustments.”
The standard mileage rate is an IRS-set figure that is calculated in cents per mile, used to find the deductible cost of using a personal vehicle for business purposes when filing federal income taxes. This benefits self-employed individuals, freelancers, and small business owners who use their personal vehicles for business. They can claim the standard mileage deduction on their tax returns.
This began on January 1st; the standard mileage rates for car, van, pickup, or panel trucks driven for business use will be 72.5 cents per mile. For medical purposes, 20.5 cents per mile, and the same rate applies for moving purposes for certain active-duty members of the Armed Forces and certain members of the intelligence community, 20.5 cents per mile. The rate that will remain the same is the rate per mile driven in the service of a charitable organization. The IRS says this will remain at 14 cents. These rates apply to fully-electric and hybrid vehicles, as well as gasoline and diesel-powered vehicles. If taxpayers are using a leased vehicle, the standard mileage rate must be applied for the entire lease period, including renewals. Meanwhile, the rate for medical and moving purposes is based only on costs that increase when you drive more, such as gas, oil changes, and basic vehicle maintenance.
The IRS also noted that the standard mileage rate is optional for taxpayers.
TRENDING: Water Injustice in Our Backyard
IRS Updates Mileage Tax Rates For 2026: What You Need to Know was originally published on majic945.com
