A business mile driven on June 30, 2026 and a business mile driven on July 1 are worth different amounts on a federal tax return. The IRS raised the standard mileage rate for business use to 76 cents a mile effective July 1, up from the 72.5 cents it had set for the whole year in December. The agency attributes the change to higher fuel prices, and it leaves 2026 carrying two business rates instead of one.
Announcement 2026-11 sets 76 cents for trips from July 1
The IRS published the change in Announcement 2026-11, printed in Internal Revenue Bulletin 2026-29. The announcement modifies Notice 2026-10, the notice that carried the original 2026 rates, and says the revision “results from recent increases in the price of fuel.” Its effective-date sentence is precise: the revised rates “apply to deductible transportation expenses paid or incurred for business, medical, or moving expense purposes on or after July 1, 2026.”
The same announcement keeps the old rates alive for the first half of the year. Notice 2026-10’s rates, it says, “continue to apply to deductible transportation expenses paid or incurred for business, medical, or moving expense purposes before July 1, 2026.” Nothing in the announcement replaces the earlier rate retroactively, so trips made through June 30 stay at the lower figure. The dividing line is a calendar date attached to when an expense is paid or incurred, not the date a return is filed, which puts a trip on June 30 and a trip on July 1 on opposite sides of it and under different rates.
The 72.5-cent rate and where it came from
The 72.5-cent business rate was announced in release IR-2025-128 on December 29, 2025, as part of the IRS’s 2026 standard mileage rates. That figure was 2.5 cents above the 70 cents of 2025. The release described the business rate as coming from an annual study of the fixed and variable costs of operating an automobile, which makes the July revision a second adjustment inside the same tax year, driven by the fuel-price change the IRS cites.
The step from 72.5 to 76 cents is 3.5 cents a mile. Over 1,000 business miles, the two rates come to $725 and $760, a $35 difference, and the gap widens in proportion to the miles driven after July 1.
One calendar year, two business rates
The IRS’s standard mileage rates page, last updated July 28, 2026, shows the split plainly. Business use is 72.5 cents a mile from January 1 through June 30, 2026, and 76 cents a mile from July 1 through December 31, 2026. Mileage on a return for the year is therefore not one number multiplied by one rate; it is two subtotals, each at its own rate, added together.
A simple illustration shows how much the split matters. Take 6,000 business miles driven in each half of the year. At the two rates, the deduction is $4,350 for the first half and $4,560 for the second, or $8,910 for the year. Applying 72.5 cents to all 12,000 miles gives $8,700, and applying 76 cents to all of them gives $9,120. Each shortcut is off by $210 from the split-rate total. These are arithmetic examples built on the IRS’s published rates, not IRS figures.
Medical, moving and charitable rates in the same announcement
The mid-year announcement changed more than the business rate. For medical and moving expenses, the rate for July 1 through December 31 is 23.5 cents a mile, and the IRS page labels the moving rate as applying to military only. The December release had put both medical and moving at 20.5 cents, so the July figure is 3 cents higher.
The charitable rate did not move. It stays at 14 cents a mile, and Announcement 2026-11 describes it as fixed by statute under Internal Revenue Code section 170(i). Charitable driving is the one mileage category with a single rate for all of 2026.
What the IRS has not published for 2027
The IRS standard mileage rates page shows no 2027 rates as of the July 28 update, and the page read for this story contains no 2027 business, medical or charitable figure. The 2026 rates themselves arrived on December 29, 2025, so a 2027 announcement has no published date and none can be assumed. Until the IRS posts a notice, the 76-cent rate is the most recent business rate in the agency’s table, and it is a rate for the second half of 2026 only.
The rates are a way of computing deductible transportation expenses, which means they reduce taxable income when claimed and do not themselves pay out anything. The Announcement’s own wording covers “deductible transportation expenses,” and it does not discuss depreciation or conditions for using the standard rate, nor any rule on switching between the standard rate and actual vehicle costs, so none of those questions is answered here.
Every rate and date above comes from the IRS’s mileage rates page, Announcement 2026-11 in Internal Revenue Bulletin 2026-29 and release IR-2025-128, read on October 3, 2026.
Mileage logs, refunds and the paper trail behind a deduction
A return that carries business mileage at two different rates is a return where a deduction and a refund both depend on records the filer assembled, and the costly gap comes after filing, when a refund is slow or a notice arrives about it. The news from the IRS settles the rates for each half of 2026 but does not follow what happens to the refund that results.
The IRS Refund Recovery Kit includes a notice decoder and a refund status tracker spreadsheet, along with the refund-trace steps for Form 3911 and the 3-year refund deadline.
Line up The IRS Refund Recovery Kit’s notice decoder and status tracker for the 2026 return →
This piece was drafted with AI assistance; the rates and dates were checked against the IRS standard mileage rates page, Announcement 2026-11 and the IRS’s December 29, 2025 release.
