IRS Mileage Rate 2026: 72.5 Cents, Then 76 Cents From July 1
The IRS business standard mileage rate for 2026 is 72.5 cents per mile for driving from January 1 to June 30 (Notice 2026-10) and 76 cents per mile from July 1 to December 31 (Announcement 2026-11). Each business mile takes the rate in force on the date you drive it, so a full-year 2026 deduction combines both figures. An electric Tesla uses the same rate as a gas car.
Why the 2026 rate changed in July
The IRS announced the 2026 rates on December 29, 2025 in IR-2025-128, and Notice 2026-10 set the business rate at 72.5 cents a mile, up 2.5 cents from 2025. Announcement 2026-11, published in Internal Revenue Bulletin 2026-29 on July 13, 2026, raised it to 76 cents for transportation expenses paid or incurred on or after July 1, 2026, giving recent increases in the price of fuel as the reason. The medical and military moving rate rose from 20.5 to 23.5 cents on the same date, and the charity rate stayed at 14 cents, a figure the law fixes. Every other provision of Notice 2026-10 remains in effect, including the 35-cent depreciation part and the $61,700 caps used for FAVR plans and company-car valuation.
Business rates from 2023 to 2026
Earlier rates still apply to the returns of those years, amended returns included. The business rate was 65.5 cents in 2023 (IR-2022-234), 67 cents in 2024 (Notice 2024-8), 70 cents in 2025 (Notice 2025-5), 72.5 cents from January 1 to June 30, 2026 and 76 cents from July 1 to December 31, 2026. Fully electric and hybrid cars use these rates exactly as gasoline and diesel cars do; IR-2025-128 and IR-2024-312 both say so. For 2027, the IRS usually publishes the new rate in December: the 2024, 2025 and 2026 rates were announced on December 14, 2023, December 19, 2024 and December 29, 2025.
How to split your 2026 miles by date
Sort your business trips by date: miles driven through June 30, 2026 go at $0.725, and miles from July 1, 2026 go at $0.76. A self-employed driver with 4,000 business miles in the first half and 5,000 in the second half deducts 4,000 × $0.725 = $2,900.00 plus 5,000 × $0.76 = $3,800.00, or $6,700.00, before parking and tolls. Business parking fees and tolls are added on top of that amount. Parking at your regular workplace stays nondeductible, and commuting between home and your regular workplace never counts as business mileage, whatever the distance. A dated, trip-by-trip log makes the split mechanical. Splitting a single year-end mileage total between the two rates takes guesswork, and Publication 463 does not allow estimated amounts to be deducted.
Who can use the 2026 rate
Self-employed people and sole proprietors use it on Schedule C, line 9. W-2 employees cannot deduct unreimbursed car costs in 2026, because section 70110 of the One Big Beautiful Bill Act made the disallowance of miscellaneous itemized deductions permanent; Armed Forces reservists, fee-basis state or local officials, certain performing artists and eligible educators are the exceptions. An employer can reimburse an employee's own-car business miles up to the standard rate tax-free under an accountable plan. The rate is not allowed for any car when five or more cars are used for business at the same time, or on a car after MACRS, section 179 or bonus depreciation was claimed on it.
What the 2026 rate means for a Tesla
Your Tesla uses the same 72.5 and 76 cent rates as any gas car. Each 2026 business mile also carries a 35-cent depreciation part that reduces the car's basis, so a later sale shows a larger gain or a smaller loss. Odoproof reads each trip from the car with its date and distance, applies 72.5 cents to business trips that start before July 1, 2026 and 76 cents to trips from that date, and shows one line per rate in the report.
Sources
- Standard mileage rates Internal Revenue Service
- Notice 2026-10, 2026 standard mileage rates Internal Revenue Service
- Internal Revenue Bulletin 2026-29, Announcement 2026-11 (76 cents from July 1, 2026) Internal Revenue Service
- IR-2025-128, IRS sets 2026 business standard mileage rate at 72.5 cents per mile Internal Revenue Service
- IR-2024-312, standard mileage rate for business use in 2025 set at 70 cents per mile Internal Revenue Service
- IR-2023-239, standard mileage rates for 2024 (67 cents per mile) Internal Revenue Service
- Topic no. 510, Business use of car Internal Revenue Service
- Instructions for Schedule C (Form 1040) Internal Revenue Service
- Publication 463, Travel, Gift, and Car Expenses Internal Revenue Service
FAQ
What is the IRS mileage rate for July 2026?+
76 cents per business mile for driving from July 1 to December 31, 2026, set by Announcement 2026-11. Driving from January 1 to June 30, 2026 stays at 72.5 cents.
Do I use 76 cents for all of 2026?+
No. Business miles driven before July 1, 2026 use 72.5 cents, and applying 76 cents to the whole year overstates the deduction.
Is the 2026 rate different for electric cars?+
The IRS sets one business rate for every car, so an electric Tesla, a hybrid and a gas car all use 72.5 cents, then 76 cents from July 1, 2026.
When will the IRS publish the 2027 mileage rate?+
Usually in December, as with the rates announced on December 14, 2023, December 19, 2024 and December 29, 2025. Until the 2027 notice appears, the 76-cent rate covers driving through December 31, 2026.
For 2026, apply 72.5 cents to business miles driven through June 30 and 76 cents from July 1, then add parking and tolls. Start your 7-day free trial of Odoproof to get every Tesla trip dated and priced at the right IRS rate automatically.
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