Your Guide to the Latest Per-Mile Deduction Rates
Use these latest tax-deductible driving rates to calculate how many miles you can claim on your tax return.
• Business mileage: $0.70 per mile
• Medical mileage: $0.21 per mile
• Charity-related mileage: $0.14 per mile
Looking for past federal mileage rates (2024 and beyond)? Find them here.
Federally recognised mileage guidelines help people figure out how much mileage they can deduct on their taxes. And if you’re a business owner with drivers, these guidelines are important for reimbursements.
This guide will help you brush up on the updated per-mile deductions.
Why federal mileage guidelines matter (it’s all about tax savings)
Different people need to track mileage for different reasons. If one or more of these apply to you, you should pay attention to changing mileage rates.
You’re self-employed
What do real estate agents, plumbers, mobile dog groomers, delivery drivers, and construction labourers have in common? They’re often self-employed and drive for work.
If you fit into that Venn diagram, you can likely use business mileage deduction rates to save on your taxes. Claiming mileage deductions reduces the amount of your money subject to tax – meaning more cash stays in your pocket.
What can I deduct?
Business mileage at $0.70 per mile
You itemize your taxes
If you add up all the deductions you qualify for and the total is greater than the standard deduction, you should itemize your taxes. That includes claiming mileage deductions on medical mileage and charity-related drives.
What can I deduct?
- Medical mileage at $0.21 per mile (your total medical expenses for that tax year need to be over 7.5% of your adjusted gross income)
- Charity-related mileage at $0.14 per mile (refers to driving for a non-profit as a volunteer)
You own a business that reimburses drivers
Use the latest tax-deductible driving rates to reimburse your drivers tax-free. You can always pay them more, but any amount above the most recent rate will need to be taxed like regular income.
Use the business mileage rate to reimburse employees tax-free ($0.70 per mile)
Use the business mileage rate to reimburse employees tax-free ($0.70)
Rates can change mid-year
Sometimes the IRS will update rates during the year if there are big changes in the economy. Make sure to either check a government website or this page before calculating deductions.
How to calculate mileage deductions and reimbursements
Here’s how to use the latest tax-deductible driving rates to calculate mileage.
Mileage x latest mileage rate = mileage deduction or reimbursement
Business mileage example
Let’s say you’re welder, working on different construction sites throughout the year. You drive to these sites in your own van. You tracked 500 business miles and now it’s time to reap the rewards of all that diligent mileage keeping.
500 mi * $0.70 (the latest business mileage rate) = $350
This means you can claim a $350 business mileage deduction on your taxes. This calculation is exactly the same for medical and charity mileage deductions.
Best practices for mileage tracking
To get the maximum tax benefit, you’ll need to have all your miles accounted for. When documenting each deductible mile, make sure to include:
- Dates
- Destination addresses
- Business purpose
- And of course, total mileage
You should also take an odometer reading at the beginning of every year because you’ll need to include it on your tax return forms.
Don’t mix business and personal drives
If you’re tracking business drives on a personal vehicle, it’s easy to get confused. Make sure you have a system to separate the two. The easiest way is to track miles with an app that can classify drives automatically.
The easiest way to track mileage
While knowing the latest tax-deductible driving rates is useful, most people don’t want to think about them every day. That’s where an app like MileIQ comes in handy. MileIQ helps self-employed people, businesses, and anyone else who needs to record mileage by tracking drives automatically.
- Set-it-and-forget it mileage tracking: Download MileIQ, add an odometer reading, and you’re good to go. There are no mileage logs to update. All your drives are tracked automatically.
- Mileage deductions calculated for you: No math required. MileIQ by default uses the latest mileage rates and updates them whenever the government does. You can also set custom rates.
- Easy, tax-compliant reporting: Mileage reports are automatically generated with a tap and annual summaries come with instructions on how to apply the newest per-mile rate for your tax return.
Maximize your mileage deductions
Track drives automatically with MileIQ.
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