Business Mileage Calculator Guide — How to Calculate & Claim
This guide covers how to calculate business mileage for tax deductions or employee reimbursement using the IRS standard mileage method. For the actual calculation, use the Mileage Reimbursement Calculator on the home page.
Step 1 — Determine Which Miles Qualify
Not all driving counts as business mileage. The IRS allows deductions only for miles driven in service of a business or trade — not personal trips, and not your regular commute.
Qualifying business miles include:
- Travel between two business locations (e.g., office to client)
- Travel to temporary work sites (expected to last under one year)
- Travel from a qualifying home office to other business locations
- Business errands (picking up supplies, bank deposits for the business)
- Travel to meet clients or customers
Non-qualifying miles: Daily commute to your regular workplace, personal errands, vacation, and any driving unrelated to business.
See the full breakdown in the Business vs. Commuting Miles guide.
Step 2 — Choose Your Method
You have two options for deducting vehicle costs:
- Standard mileage rate: Multiply qualified miles by the IRS rate (72.5¢/mile for 2026). Simpler, requires only a mileage log.
- Actual expense method: Track all vehicle costs (fuel, insurance, depreciation, repairs, registration) and multiply the total by your business-use percentage. More complex; can be larger for high-cost vehicles with high business-use percentage.
For most self-employed individuals and small business owners, the standard mileage rate is sufficient and easier to substantiate. Consult a CPA if you have an expensive vehicle or very high vehicle costs relative to your mileage.
Step 3 — Keep a Mileage Log
IRS Publication 463 requires a contemporaneous mileage log — meaning recorded at or near the time of each trip, not reconstructed from memory later. Your log must include:
- Date of each trip
- Destination (city or specific address)
- Business purpose of the trip
- Miles driven
Use the printable mileage log template or a tracking app such as MileIQ, Everlance, or Stride.
Step 4 — Calculate the Deduction
Once you have your total qualified business miles for the year, the math is straightforward:
Deduction = Total Business Miles × IRS Rate ÷ 100
Example: 10,000 business miles in 2026 × 72.5¢ ÷ 100 = $7,250 deduction.
Use the Annual Mileage Deduction Calculator to see your estimated deduction and tax savings across different mileage totals.
Step 5 — Report the Deduction
Where you report business mileage depends on your filing situation:
- Self-employed (sole proprietor): Schedule C, Part II, Line 9 (Car and truck expenses).
- S-Corp shareholders / partners: Work with the entity — the reimbursement is deducted by the business, not directly on your personal return.
- Farmers: Schedule F.
- Armed Forces moving expense: Form 3903.
- W-2 employees (most): Unreimbursed employee expenses are not deductible at the federal level through at least 2025. Check your state return.
2026 IRS Mileage Rates (Verified)
| Purpose | 2026 Rate | Source |
|---|---|---|
| Business | 72.5¢/mile | IRS Notice 2026-10 |
| Medical | 20.5¢/mile | IRS Notice 2026-10 |
| Charitable | 14¢/mile | 26 U.S.C. § 170 (statutory) |
Rates verified from irs.gov as of June 12, 2026. See full rate history 2020–2026.
Frequently Asked Questions
Multiply your total qualifying business miles by the IRS standard mileage rate for the tax year. For 2026, the rate is 72.5 cents per mile. Example: 8,000 business miles × $0.725 = $5,800 deduction. Keep a contemporaneous mileage log recording date, destination, business purpose, and miles for each trip.
The standard mileage method (using the IRS rate per mile) is simpler — you just track miles. The actual expense method requires tracking every vehicle cost: fuel, oil changes, insurance, registration, depreciation, and repairs, then applying your business-use percentage. The actual method can be larger if you have high vehicle costs and low mileage, but requires more record-keeping.
If you used the standard mileage method in the first year you used the vehicle for business, you can switch to actual expenses in later years. However, if you use actual expenses first, you must continue with actual expenses for that vehicle. Leased vehicles must use the same method for the entire lease term.
Most employers reimburse at the IRS standard mileage rate (72.5¢/mile for 2026) because it is tax-free to the employee and deductible for the employer when paid under an accountable plan. Some employers use a lower fixed rate or a FAVR (Fixed and Variable Rate) plan. Reimbursements above the IRS rate are treated as taxable wages.