What Is the 2024 Federal Mileage Allowance?

The federal mileage allowance is a rate set by the Internal Revenue Service (IRS) that allows taxpayers to deduct the costs of operating a vehicle for specific purposes. This deduction simplifies record-keeping by providing a standardized cents-per-mile amount instead of requiring taxpayers to track every vehicle-related expense. These allowances apply when a vehicle is used for business, qualified medical travel, moving for active-duty military members, or in service of a charitable organization.

2025 Standard Mileage Rates

The IRS provides distinct standard mileage rates for different types of vehicle use, which are adjusted periodically to reflect economic changes. For the 2025 tax year, the rate for business use of a vehicle is 70 cents per mile.

A different rate applies for travel related to medical care or for moving purposes for qualified active-duty members of the Armed Forces. For 2025, this rate is 21 cents per mile. The rate for miles driven in service of a qualified charitable organization is set by statute and is 14 cents per mile for 2025.

Determining Eligibility for the Deduction

The ability to claim a deduction for vehicle mileage primarily extends to self-employed individuals. This group includes independent contractors, gig economy workers, and sole proprietors who use their personal vehicle for business-related activities. These taxpayers can deduct the costs associated with driving to meet clients, traveling between temporary work locations, or running business errands. Commuting miles driven between a taxpayer’s home and their regular place of business are not deductible.

For most traditional employees, the option to deduct unreimbursed business mileage is currently unavailable. The Tax Cuts and Jobs Act of 2017 (TCJA) suspended the miscellaneous itemized deduction for unreimbursed employee business expenses for the tax years 2018 through 2025.

However, certain individuals can still claim the deduction for unreimbursed employee travel expenses, including:

• Armed Forces reservists
• Fee-basis state or local government officials
• Qualified performing artists
• Employees with impairment-related work expenses

Information Needed to Calculate Your Deduction

Taxpayers have two methods to calculate their vehicle deduction: the standard mileage rate or the actual expense method. A taxpayer must choose one method for a vehicle in a given year.

To use the standard mileage rate, maintaining a detailed mileage log is a requirement. The log must include the total miles driven for the year, with a specific breakdown of miles for each business trip. For each business use, the log must document the date of the trip, the destination, and the specific business purpose.

If you opt for the actual expense method, you must keep records and receipts for all vehicle-related costs. These deductible expenses include:

• Gasoline
• Oil changes
• Repairs
• Tires
• Insurance premiums
• Registration fees
• Depreciation

To calculate the deduction, you sum up all these costs for the year and then multiply the total by the percentage of business use for the vehicle. For example, if 60% of your car’s use was for business, you could deduct 60% of its total operating expenses.

How to Claim the Deduction on Your Tax Return

The specific form to claim the deduction depends on your employment status. Self-employed individuals, such as independent contractors or sole proprietors, will claim this deduction on IRS Form 1040, Schedule C, “Profit or Loss from Business.” The deduction is entered on the line designated for car and truck expenses.

For the limited categories of employees who are still eligible to deduct unreimbursed business expenses, the process is different. These taxpayers must use Form 2106, “Employee Business Expenses,” to report their vehicle expenses. The total from Form 2106 is then transferred to Schedule 1 of Form 1040 as an adjustment to income.