To calculate business mileage, multiply your total deductible business miles by the IRS standard mileage rate, which is 72.5 cents per mile for 2026. If you drove 10,000 business miles this year, your deduction would be $7,250. The key steps are tracking every qualifying trip, keeping a proper mileage log, and choosing the right calculation method at tax time.
Who Can Deduct Business Mileage
The business mileage deduction is available to self-employed individuals, small business owners, and independent contractors. If you drive for a rideshare service, do freelance work, or run any kind of business where you use your personal vehicle, you can deduct qualifying miles.
Most W-2 employees cannot deduct business mileage on their taxes. The Tax Cuts and Jobs Act suspended the deduction for unreimbursed employee business expenses starting in 2018. The only exceptions are Armed Forces reservists, qualified performing artists, fee-basis state or local government officials, and employees with impairment-related work expenses. If your employer reimburses you for mileage, that reimbursement isn’t taxable income to you, but you also can’t claim a separate deduction.
Which Miles Count as Business Miles
Not every trip in your car qualifies. The IRS draws a clear line between deductible business driving and non-deductible commuting, and getting this distinction right is the foundation of an accurate calculation.
Commuting is never deductible. Driving from your home to your regular place of work and back is a personal expense, no matter how far the drive is. This applies whether you drive, take a bus, or use a rideshare.
Trips between work locations are deductible. If you work at two places in one day, whether for the same employer or not, the drive between those workplaces counts as business mileage.
Temporary work locations are deductible. If you have a regular office but drive to a temporary job site in the same trade or business, the round trip from your home to that temporary location is deductible. If you have no regular office but normally work within your metro area, trips to temporary sites outside that metro area qualify.
A home office changes the rules in your favor. If your home office qualifies as your principal place of business, every trip from home to another work location in the same business is deductible. That first drive of the day, which would otherwise be a non-deductible commute, becomes a business trip.
Rideshare drivers have specific limits. The drive from home to pick up your first passenger and the drive home after dropping off your last passenger are not deductible. Only the miles driven between your first business stop and your subsequent stops count.
The Standard Mileage Rate Method
The simplest way to calculate your deduction is the standard mileage rate. You multiply your business miles by the IRS rate for that tax year. For 2026, that rate is 72.5 cents per mile. For 2025 (taxes you’ll file in early 2026), the rate is 70 cents per mile.
Here’s what the math looks like: if you drove 8,000 business miles in 2026, your deduction is 8,000 × $0.725 = $5,800. The standard rate is designed to cover gas, oil, insurance, repairs, depreciation, and general wear on the vehicle. You don’t need to track individual expenses for any of those categories. You can still deduct parking fees and tolls on top of the standard mileage rate.
There’s one important restriction. To use the standard mileage rate on a car you own, you must choose it in the first year you start using that car for business. After that first year, you can switch to the actual expense method if you want. But if you lease a vehicle and choose the standard mileage rate, you must stick with it for the entire lease period, including renewals.
The Actual Expense Method
Instead of using the flat per-mile rate, you can add up all the actual costs of operating your vehicle and deduct the business-use percentage. This method requires more recordkeeping, but it can produce a larger deduction if you drive an expensive vehicle or have high operating costs.
Eligible expenses include gas, oil changes, repairs, new tires, insurance premiums, registration fees, license costs, and depreciation (or lease payments if you lease). Add all of these up for the year, then multiply by your business-use percentage. To find that percentage, divide your business miles by your total miles driven. If you drove 15,000 total miles and 9,000 were for business, your business-use percentage is 60%. If your total vehicle expenses were $12,000, your deduction would be $12,000 × 0.60 = $7,200.
One thing to know if you switch methods: if you used the standard mileage rate in the first year and later switch to actual expenses, you must use straight-line depreciation for the remaining useful life of the car. You can’t use accelerated depreciation methods after starting with the standard rate.
How to Keep a Mileage Log
A mileage log is not optional. Without one, the IRS can disallow your entire deduction in an audit. Your log needs to record five things for every business trip:
- Date of the trip
- Miles driven (starting and ending odometer readings, or the trip distance)
- Destination (where you went)
- Business purpose (why you drove there)
- Person or company visited (who you met with, if applicable)
You should also keep two documents showing your odometer reading: one from near the beginning of the year and one from near the end. Repair receipts or oil change records work well for this because they typically print the odometer reading. These help verify your total annual mileage if your log is ever questioned.
You can keep your log on paper, in a spreadsheet, or with a mileage tracking app. Apps that use GPS to automatically record trips are popular because they reduce the chance of forgetting to log a drive. Whatever method you use, record trips as close to real time as possible. Reconstructing a year’s worth of driving from memory at tax time is both inaccurate and unlikely to hold up in an audit.
Choosing the Right Method
Run the numbers both ways before filing, at least for the first year. If you drive a newer or more expensive car, actual expenses often produce a larger deduction because depreciation and insurance costs are higher. If you drive an older, paid-off car with low operating costs but put a lot of business miles on it, the standard mileage rate usually wins.
The standard rate also wins on simplicity. You only need to track miles, not every receipt for gas, repairs, and insurance. Many self-employed people choose the standard rate purely to reduce their bookkeeping burden. If you use the actual expense method, you need to keep receipts or records for every vehicle-related cost throughout the year.
Where to Report Business Mileage on Your Taxes
Self-employed individuals and sole proprietors report vehicle expenses on Schedule C (Form 1040), in the section for car and truck expenses. You’ll fill out Part IV of Schedule C, which asks for total miles driven, business miles, commuting miles, and whether you have written documentation to support your claim.
If you use your vehicle for a business operated as a partnership or S corporation, the reporting may flow through different forms, but the underlying calculation is the same: business miles times the standard rate, or actual expenses times the business-use percentage.
Keep your mileage log and supporting documents for at least three years after filing, since that’s the standard window the IRS has to audit most returns. If you significantly underreport income, that window extends to six years, so holding records longer is a reasonable precaution.