IRS Mileage Rates Increased Effective July 1, 2026

In a rare midyear adjustment, the Internal Revenue Service increased several standard mileage rates effective July 1, 2026.

The business standard mileage rate increased from 72.5 cents to 76 cents per mile, while the rates for eligible medical and moving travel increased from 20.5 cents to 23.5 cents per mile. The charitable mileage rate remains unchanged at 14 cents per mile because it is established by federal law.

The IRS stated that the midyear adjustment was made in response to recent increases in fuel prices.

Updated 2026 Standard Mileage Rates

For mileage incurred from July 1 through December 31, 2026, the optional standard mileage rates are:

• Business use: 76 cents per mile
• Medical purposes: 23.5 cents per mile
• Qualifying moving purposes: 23.5 cents per mile
• Charitable service: 14 cents per mile

The moving-expense rate generally applies only to eligible active-duty members of the Armed Forces who are relocating under military orders and certain qualifying members of the intelligence community.

The rates apply to cars, vans, pickup trucks and panel trucks, including gasoline, diesel, hybrid and fully electric vehicles.

Two Mileage Rates Apply During 2026

Because the change took effect in the middle of the year, taxpayers and employers must use different rates depending on when the travel occurred.

January 1 through June 30, 2026

• Business use: 72.5 cents per mile
• Medical and qualifying moving purposes: 20.5 cents per mile
• Charitable service: 14 cents per mile

July 1 through December 31, 2026

• Business use: 76 cents per mile
• Medical and qualifying moving purposes: 23.5 cents per mile
• Charitable service: 14 cents per mile

The date the mileage was incurred—not the date an expense report was prepared—determines which rate applies.

How the Standard Mileage Rates Are Used

The IRS standard mileage rates provide an optional method for calculating the deductible or reimbursable cost of operating a personal vehicle for qualifying purposes.

Businesses may use the business mileage rate when reimbursing employees for properly documented business travel. Self-employed taxpayers and other eligible individuals may also use the rate when calculating deductible vehicle expenses.

Taxpayers are not required to use the standard mileage method. When permitted, they may instead calculate and document the actual costs of operating the vehicle.

What Employers Should Do

Employers should update their mileage-reimbursement policies and accounting systems to reflect the July 1 change.

Businesses should also:

• Separate mileage incurred before and after July 1, 2026
• Update employee expense-report forms and reimbursement software
• Communicate the new rate to employees and managers
• Continue requiring records showing the date, destination, business purpose and number of miles traveled
• Confirm that reimbursements satisfy the IRS accountable-plan requirements

Properly substantiated reimbursements made under an accountable plan are generally not treated as taxable wages to the employee.

Key Takeaway

The midyear mileage-rate increase provides additional relief for businesses, employees and eligible taxpayers facing higher transportation costs during the second half of 2026.

Beginning July 1, qualifying business mileage may be calculated at 76 cents per mile, while eligible medical and moving mileage may be calculated at 23.5 cents per mile. Taxpayers and employers should carefully separate mileage incurred during the first and second halves of the year to ensure deductions and reimbursements are calculated correctly.