IRS increases 2026 business mileage rate by 2.5 cents

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FILE - Vehicles drive along Pennsylvania Ave. during rush hour traffic at sunrise Wednesday, Oct. 1, 2025, in Washington, with the U.S. Capitol in the background. (AP Photo/Julia Demaree Nikhinson, File)

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11:39 AM on Tuesday, December 30, 2025

By Associated Press

WASHINGTON (AP) — The standard mileage rate for the business use of a car, truck, van or other vehicle will increase by 2.5 cents in 2026.

The IRS announced Monday that beginning Jan. 1, the standard mileage rate for a qualifying vehicle will be 72.5 cents per mile, up 2.5 cents from 2025.

The rate will be 20.5 cents per mile driven for medical purposes, down a half cent from 2025 and will be 20.5 cents per mile driven for moving purposes for certain active-duty members of the Armed Forces and certain members of the intelligence community, which is reduced by a half cent from last year.

The change, meant to reflect updated cost data and annual inflation adjustments, applies to fully-electric and hybrid automobiles, and gas and diesel-powered vehicles.

Use of the standard mileage rates is optional. People who use a their car for work may instead choose to calculate the actual costs of using their vehicle.