Mileage Reimbursement: IRS Rates & Rules (2026)
How mileage reimbursement works, the 2026 IRS standard mileage rate, what counts as business miles, whether reimbursement is required or taxable, and the free calculator that does the math.
What is the IRS standard mileage rate?
The IRS standard mileage rate is a single per-mile figure you can use to value business driving without tracking the actual cost of running your car. It is designed to cover everything — fuel, maintenance, repairs, tires, insurance, registration, and depreciation — so you do not add those costs separately. The IRS sets a new rate every year. For 2026 the business rate is 72.5¢ per mile (Notice 2026-10, effective January 1, 2026), up from 70¢ in 2025. The 2026 medical/moving rate is 20.5¢ and the charitable rate is 14¢.
How to calculate reimbursement
The math is simply business miles × the rate. At the 2026 business rate, 100 business miles is 100 × $0.725 = $72.50. Confirmed IRS business rates are 72.5¢ (2026), 70¢ (2025), 67¢ (2024), and 65.5¢ (2023). The Mileage Reimbursement calculator has those years built in and also lets you enter a custom rate to match a company policy that differs from the IRS figure.
What counts as business mileage
Your normal commute between home and your regular workplace is personal and never reimbursable. Driving between job sites, to clients, or to a temporary work location during the workday generally does qualify. Keep a contemporaneous log of dates, destinations, purpose, and miles — the IRS expects records to support a reimbursement. If you also need to total the hours for those trips, the Time Card calculator adds up a full week from clock in/out times.
Is reimbursement required — and is it taxable?
Federal law does not require private employers to reimburse mileage, but unreimbursed business expenses cannot push a worker’s pay below the federal minimum wage. Some states do require it: California (Labor Code §2802) and Massachusetts require reimbursement of necessary business expenses, including mileage. On taxes: reimbursement paid at or below the IRS rate under an accountable plan is generally not taxable income. Anything paid above the IRS rate, or without proper records, is treated as taxable wages.
Reimbursement vs total pay
Mileage reimbursement is not wages — it repays a cost — so it usually sits outside your gross pay. If you want to see reimbursements and earnings rolled into one yearly figure, the Annual Income calculator combines base pay, bonuses, commission, and other income. Sales roles that pair driving with commission can use the Commission calculator for the earnings side.
Frequently asked questions
The 2026 IRS standard business mileage rate is 72.5 cents per mile (Notice 2026-10, effective January 1, 2026), up 2.5 cents from 70 cents in 2025. The 2026 medical/moving rate is 20.5 cents and the charitable rate is 14 cents.
Multiply your business miles by the per-mile rate. At the 2026 business rate, 200 miles × $0.725 = $145. Use the IRS rate or a custom company rate. Your commute to your regular workplace does not count.
Federal law does not require it, though unreimbursed expenses cannot drop pay below minimum wage. California (Labor Code §2802) and Massachusetts require reimbursement of necessary business expenses, including mileage.
Reimbursement at or below the IRS rate under an accountable plan is generally not taxable. Amounts above the IRS rate, or paid without proper mileage records, are treated as taxable wages.