2026 IRS Mileage Rate: 72.5¢, Then 76¢ From July 1, for Contractors
The 2026 business mileage rate is 72.5 cents through June 30 and 76 cents from July 1. How contractors choose standard mileage or actual costs.
By Seayora Editorial Team · Published · Facts checked · 3 min read
Short answer: For 2026 the IRS 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, after Announcement 2026-11 raised it for fuel costs. A self-employed contractor can deduct business miles at that rate, plus business parking and tolls, instead of actual vehicle costs. To use the rate for a car you own, you must choose it in the first year the car is used in the business, and a business running five or more vehicles at the same time cannot use it.
Key takeaways
- January 1 to June 30, 2026: 72.5 cents per business mile. From July 1, 2026: 76 cents.
- Business parking and tolls are deductible on top of the standard rate.
- Choose the standard rate in the vehicle’s first business year to keep the option later.
- Driving from home to your regular place of business is commuting and is not deductible.
What is the 2026 business mileage rate?
Notice 2026-10 set the 2026 business rate at 72.5 cents per mile, up 2.5 cents from 2025 (IRS). Announcement 2026-11 then raised it to 76 cents per mile for expenses paid or incurred on or after July 1, 2026, citing higher fuel prices; all other provisions of Notice 2026-10 remain in effect (Internal Revenue Bulletin 2026-29). So a 2026 mileage log needs the date of each trip, not just a total.
| Use | Jan 1 – Jun 30, 2026 | Jul 1 – Dec 31, 2026 |
|---|---|---|
| Business | 72.5¢ per mile | 76¢ per mile |
| Medical and moving (qualifying) | 20.5¢ per mile | 23.5¢ per mile |
| Charitable | 14¢ per mile | 14¢ per mile |
Standard mileage or actual expenses?
The standard rate replaces fuel, repairs, insurance, depreciation and similar costs. Business parking fees and tolls can be deducted in addition to it. To use the standard rate for a car you own, you must choose it in the first year the car is available for use in your business; in later years you can switch between the standard rate and actual expenses. For a leased car, the standard rate must be used for the entire lease if you use it at all (IRS Publication 463).
If you own or lease five or more cars used for business at the same time, you cannot use the standard rate for any of them and must deduct actual expenses instead. Alternating between vehicles does not count as using them at the same time.
Which trips count as business miles for a contractor?
- Driving between job sites, to a supply house and back to a job, or to meet a customer counts.
- Driving from home to your regular place of business, such as your shop or yard, is commuting, and commuting is never deductible.
- If your home office is your principal place of business, trips from home to job sites in the same business can be deductible.
- Trips from home to a temporary work location outside the metropolitan area where you live are deductible; within the area they generally are not unless you have a regular work location or a qualifying home office.
Keep a written log of the date, destination, purpose and miles for each trip. A log built from your job schedule is easier to defend than a reconstruction at year end.
Frequently asked questions
What is the IRS mileage rate for 2026?
72.5 cents per business mile for January 1 through June 30, 2026, and 76 cents per mile from July 1, 2026 (Announcement 2026-11).
Is the July 2026 mileage increase retroactive?
No. The 76-cent rate applies to expenses paid or incurred on or after July 1, 2026. Earlier miles use 72.5 cents.
Can I deduct tolls if I use the standard mileage rate?
Yes. Business-related parking fees and tolls are deductible in addition to the standard rate.
Sources
- IRS sets 2026 business standard mileage rate at 72.5 cents per mile (IR-2025-128), Internal Revenue Service
- Internal Revenue Bulletin 2026-29, Announcement 2026-11, Internal Revenue Service
- Publication 463, Travel, Gift, and Car Expenses, Internal Revenue Service
How Seayora helps
Mileage log: Log business miles from your scheduled jobs, with the date each rate applies.
This article is general information, not tax advice. Tax rules change and your situation is your own, so confirm the treatment with a CPA or enrolled agent before you file.
How we write and check these guides: editorial standards.
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