Anyone still logging business miles for the second half of 2026 at 72.5 cents apiece is leaving real money on the table. The IRS raised its standard mileage rate for business driving to 76 cents a mile for trips taken from July 1 through December 31, a jump of 3.5 cents from the rate that applied over the first six months of the year. It’s an unusual mid-year change, and it means 2026 is a two-rate year for anyone who tracks vehicle costs for a living.
Two Rates, One Calendar Year
Business miles driven from January 1 through June 30, 2026 are deductible at 72.5 cents per mile, a rate the agency announced late last year. Miles driven from July 1 through December 31 jump to 76 cents, a rate the agency published mid-year. The standard mileage rate is meant to approximate the true cost of owning and running a vehicle — fuel, maintenance, insurance, depreciation — and the agency adjusts it when those costs move enough during the year to justify a correction rather than waiting for the next calendar year.
The rate applies to self-employed workers, small-business owners, and other filers who use a personal vehicle for work and choose the standard mileage method instead of tracking actual expenses. It does not apply to unreimbursed employee driving, since the 2017 tax law suspended that deduction for W-2 employees through at least 2025 with only narrow exceptions. The full rate table traces the first-half figure to last year’s announcement and the second-half figure to guidance in the Internal Revenue Bulletin.
A mid-year change to the business rate is unusual enough that the agency’s own historical table, which stretches back more than a decade, shows only a handful of years where the rate moved twice — typically tied to a sharp swing in fuel prices that made the January figure look stale well before the calendar turned over. Employers who reimburse workers for business driving at the IRS rate, rather than at a rate they set themselves, need to update their reimbursement systems for the July 1 switch or risk either shortchanging employees for the second half of the year or overpaying and creating a taxable-income problem on the excess.
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Medical and Military Moving Rates Rose Too
The business rate wasn’t the only one to move mid-year. The rate for medical driving — trips to appointments, treatment, or picking up prescriptions that qualify as deductible medical expenses — rose from 20.5 cents to 23.5 cents per mile on the same July 1 split. The moving-expense mileage rate, which is now limited by federal law to active-duty members of the Armed Forces and the intelligence community relocating under military orders, tracks the same figure and moved the same 3-cent amount at the same time.
Both of these categories carry their own eligibility rules layered on top of the mileage math. Medical mileage only counts toward a deduction to the extent a filer’s total qualifying medical expenses clear the threshold for itemizing medical costs in the first place, and the moving rate is now off-limits to the ordinary civilian household moves that used to qualify before the 2017 tax overhaul narrowed it.
Charity Miles Stay Frozen by Law
While business, medical and moving rates moved twice within a single year, the charitable mileage rate did not move at all — it stayed at 14 cents per mile through both halves of 2026. That is not an oversight. The charitable rate is set directly by statute rather than adjusted administratively by the IRS the way the other rates are, which is why it has held at 14 cents on the agency’s own historical table going back well over a decade, through years when gas prices and vehicle costs moved sharply in both directions. Changing it requires an act of Congress, not a mid-year IRS bulletin.
Split Records Matter for the Deduction
The two-rate year creates a practical wrinkle for anyone claiming the mileage deduction on their 2026 return: miles driven before July 1 and miles driven on or after July 1 have to be tracked and totaled separately, since they’re worth different amounts. A gig driver, real estate agent, home-health aide, or small contractor who simply adds up a year’s worth of business miles without splitting them by date risks either underclaiming the deduction for second-half driving or, worse, overclaiming by applying the higher rate to miles driven before it took effect.
A simple mileage log — date, purpose, and odometer reading or mapped distance — done consistently through the year is still the best defense if the IRS ever asks for support. For drivers logging heavy business mileage in the second half of the year, the extra 3.5 cents per mile adds up: on 10,000 miles of second-half driving alone, it’s the difference between a $7,250 deduction at the old rate and a $7,600 deduction at the current one.
Filers also still have the option of skipping the standard mileage rate entirely and deducting actual vehicle expenses instead — gas, insurance, repairs, depreciation, all prorated to the share of driving that was for business. That method usually takes more recordkeeping but can be worth more for someone driving an expensive or fuel-inefficient vehicle. Whichever method a filer uses, the choice generally has to stay consistent for that vehicle from year to year once made, which is one more reason to nail down mileage totals now rather than reconstructing them from memory next April.
This article was produced with AI assistance and reviewed by a human editor. Figures are linked to their primary sources; where a claim could not be verified from the public record, we say so.
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