The Business Mileage Deduction: What You Can Deduct in 2026

If you drive for your business and you're not tracking miles, you're leaving real money on the table.

The business mileage deduction is one of the most valuable — and most commonly missed — deductions available to self-employed individuals and small business owners. Here's everything you need to know to claim it correctly in 2026.

The IRS allows you to deduct the cost of using your personal vehicle for business purposes. You can calculate this deduction one of two ways: the standard mileage rate or the actual expense method.

For 2026, the IRS standard mileage rate for business use is 70 cents per mile (per IRS Rev. Proc. 2025-30, effective January 1, 2026).

That means if you drive 10,000 business miles in a year, you could deduct $6,700 from your taxable income.

Not every mile you drive is deductible. The IRS is specific about what counts.

Deductible business miles include:

• Driving to meet a client or customer
• Traveling between job sites or work locations
• Driving to pick up supplies or materials for your business
• Going to the bank, post office, or office supply store for business purposes
• Driving to a temporary work location (not your regular place of business)

Non-deductible miles include:

• Commuting from home to your regular office or workplace
• Personal errands, even if you're also running a business errand on the same trip
• Driving to a permanent second workplace

Multiply your total business miles by the IRS rate for the year. Simple, clean, and requires only a mileage log.

Best for: Owners who drive a lot for business, have a fuel-efficient vehicle, or want simplicity.

Track every vehicle-related expense — gas, insurance, registration, repairs, depreciation — and deduct the business-use percentage.

Example: If you use your car 60% for business and your total vehicle expenses are $8,000, you can deduct $4,800.

Best for: Owners with high actual vehicle costs (older cars with expensive repairs, high insurance premiums, or heavy depreciation on a newer vehicle).

Run the numbers both ways. In most cases, the standard mileage rate is simpler and comes out ahead for owners who drive frequently. The actual expense method can win if your vehicle costs are unusually high.

One critical rule: If you want to use the standard mileage rate, you must choose it in the first year you use the vehicle for business. You can switch to actual expenses later, but you can't go back to standard mileage after using actual expenses.

The IRS requires "adequate records" to support a mileage deduction. A contemporaneous mileage log — meaning you record trips as they happen, not from memory at year-end — is the gold standard.

Your mileage log should include for each trip:

1. Date of the trip
2. Starting location and destination
3. Business purpose
4. Odometer reading (start and end) or total miles

Tracking options:

• Mileage tracking apps (MileIQ, Everlance, TripLog) — automatically log trips via GPS; you swipe to classify as business or personal
• Google Maps / calendar — log trips manually with a note of the business purpose
• Spreadsheet — simple and free; works well if you have predictable routes
• Paper log — kept in the glove box; old-school but IRS-accepted

The worst thing you can do is try to reconstruct your mileage at tax time from memory. The IRS has rejected deductions for exactly this reason.

If you have a qualifying home office, your mileage calculation changes in your favor.

When your home is your principal place of business, every trip from home to a client, supplier, or business location is a deductible business mile — not a commute.

This is one of the biggest benefits of the home office deduction that most business owners don't realize. If you work from home and regularly drive to clients or job sites, the combination of home office + mileage tracking can add up to thousands of dollars in additional deductions.

Beyond the standard mileage deduction, there are a few other vehicle-related deductions worth knowing:

• Section 179 / Bonus Depreciation: If you purchase a vehicle used primarily for business, you may be able to deduct a large portion (or all) of the purchase price in the first year. Limits apply based on vehicle weight and business-use percentage.
• Parking and tolls: These are deductible in addition to the standard mileage rate — they're not included in the per-mile calculation.
• Interest on a vehicle loan: If the vehicle is used for business, the business-use percentage of the loan interest is deductible.

1. Not tracking miles at all. The most expensive mistake. Even rough tracking is better than nothing — but a proper log is best.

2. Deducting commuting miles. Home-to-office commuting is never deductible unless you have a qualifying home office.

3. Forgetting to log the business purpose. Miles without a documented business purpose won't survive an audit.

4. Mixing personal and business trips without proration. If you run a personal errand on the way to a client meeting, only the business portion is deductible.

5. Choosing the wrong method in year one. If you start with actual expenses, you can't switch to standard mileage for that vehicle later.

If you've been driving for business without tracking miles, start today. Even a partial year of documented mileage is better than nothing.

Here's a simple action plan:

1. Download a mileage tracking app and start logging every business trip
2. Review your calendar for the current year — you may be able to reconstruct some mileage from meeting records
3. Decide whether standard mileage or actual expenses makes more sense for your situation
4. Make sure your mileage log is ready when tax season arrives

Not sure which vehicle deduction method is right for you? The Gap ProAdvisors can review your situation and make sure you're capturing every dollar you're entitled to. Contact us or see our tax preparation services.

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• Our Tax Preparation Services
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