Because gas prices have gone up, the IRS is increasing the mileage rate businesses and individuals can use for certain vehicle expenses during the second half of 2026.
Starting July 1, 2026:
- Business mileage increases to 76 cents per mile (previously 72.5 cents).
- Medical and qualifying moving mileage increases to 23.5 cents per mile (previously 20.5 cents).
- Charitable mileage stays the same at 14 cents per mile.
These new rates only apply to miles driven on or after July 1, 2026. Any miles driven before that date must still use the earlier 2026 rates.
What does this mean for employers?
If your company reimburses employees for business travel using the IRS standard mileage rate, you’ll need to use the new rate for trips taken beginning July 1. This creates a “split-year” situation where mileage driven before and after July 1 must be reimbursed using different rates.
As always, consult your trusted tax professional!