The Basic Formula
Mileage reimbursement is calculated as: eligible miles × IRS standard mileage rate = reimbursement amount. For business travel in 2026, use miles × $0.725 for Jan-Jun or miles × $0.76 for Jul-Dec. The arithmetic is the same for employer reimbursement and eligible self-employed deduction estimates, but tax eligibility differs by taxpayer status.
The formula is simple, but the risk is in the inputs: using the wrong rate for the tax year, counting non-business miles, or failing to document the trips properly.
2026 IRS Mileage Rates at a Glance
| Period | Purpose | Rate | Who Uses It | Tax Form |
|---|---|---|---|---|
| Jan-Jun | Business | 72.5¢/mile | Employer reimbursement and self-employed | Policy or Schedule C |
| Jan-Jun | Medical | 20.5¢/mile | Taxpayers itemizing medical expenses | Schedule A |
| Jan-Jun | Moving (military) | 20.5¢/mile | Active-duty military | Form 3903 |
| Jul-Dec | Business | 76¢/mile | Employer reimbursement and self-employed | Policy or Schedule C |
| Jul-Dec | Medical | 23.5¢/mile | Taxpayers itemizing medical expenses | Schedule A |
| Jul-Dec | Moving (military) | 23.5¢/mile | Active-duty military | Form 3903 |
| All 2026 | Charitable | 14¢/mile | Qualified 501(c)(3) volunteers | Schedule A |
2026 IRS standard mileage rates by purpose.
Step-by-Step: Employee Reimbursement
1. Record each trip: date, destination, business purpose, and miles driven.
2. Separate the log into Jan-Jun and Jul-Dec 2026 mileage totals; do not combine the two periods before applying a rate.
3. Multiply Jan-Jun miles by $0.725 and Jul-Dec miles by $0.76, then add the two period totals.
4. Add any separately tracked tolls and parking fees.
5. Submit the periodized calculation with a reimbursement form. Under an accountable plan, substantiate expenses within 60 days and return any excess reimbursement.
Step-by-Step: Self-Employed Deduction
1. Maintain a contemporaneous mileage log for the entire tax year.
2. At year-end, total eligible business miles separately for Jan-Jun and Jul-Dec 2026.
3. Multiply the two period totals by $0.725 and $0.76 respectively, then add them before entering the eligible amount on Schedule C, Line 9.
4. Separately track and deduct tolls, parking, and the business-use portion of vehicle loan interest.
5. Retain the mileage log and supporting records for at least 3 years.
Common Calculation Mistakes
Using the wrong year rate: the rate applies to the date of travel, not the date of reimbursement. A December 2025 trip reimbursed in January 2026 uses the 2025 rate (70¢).
Including commuting miles: driving from home to your regular workplace is never deductible.
Blending rates: business, medical, and charitable mileage each use different rates and different tax forms.
Using estimates instead of odometer readings: round numbers or estimated distances may not hold up on audit.