The IRS has made a rare mid-year adjustment to the optional standard mileage rates. In Announcement 2026-11, published in Internal Revenue Bulletin 2026-29 on July 13, 2026, the agency raised the business standard mileage rate to 76 cents per mile for travel from July 1 through December 31, 2026 — up from 72.5 cents per mile during the first half of the year.
The IRS attributed the change to recent increases in the price of fuel. Mid-year rate changes are unusual; the last one happened in 2022, when fuel costs also spiked.
The New Rates at a Glance
Effective July 1, 2026, the optional standard mileage rates are:
| Purpose | Jan 1 – Jun 30, 2026 | Jul 1 – Dec 31, 2026 |
|---|---|---|
| Business | 72.5 cents/mile | 76 cents/mile |
| Medical or moving | 20.5 cents/mile | 23.5 cents/mile |
| Charitable | 14 cents/mile | 14 cents/mile (unchanged) |
The charitable rate is set by statute, so it does not change. The moving-mileage rate is available only to qualifying taxpayers — mainly active-duty members of the Armed Forces moving under military orders and certain members of the intelligence community. The new rates apply to all vehicle types — gasoline, diesel, hybrid, and electric.
Announcement 2026-11 modifies Notice 2026-10, which originally set the 2026 business rate at 72.5 cents per mile back in December.
What This Means for Schedule C Filers
If you use the standard mileage rate to deduct vehicle expenses on Line 9 of Schedule C, 2026 is now a two-rate year. When you prepare your return, you will need to split your business miles into two buckets:
- Miles driven January 1 through June 30 ×
$0.725 - Miles driven July 1 through December 31 ×
$0.76
Example: Suppose you drive 5,000 business miles in each half of the year.
- First half: 5,000 ×
$0.725=$3,625 - Second half: 5,000 ×
$0.76=$3,800 - Total 2026 deduction:
$7,425
That is $175 more than the same 10,000 miles would have produced at the original rate — but only if your mileage log shows when each trip happened.
Your Mileage Log Just Got More Important
The IRS requires adequate records or sufficient supporting evidence for the deduction, and a dated mileage log is the safest way to meet that standard. In a mid-year-change year it does double duty: the date of each trip determines which rate applies. For each business trip, keep recording:
- Date
- Destination and business purpose
- Miles driven
If you have been logging trips with dates all year, this change costs you nothing but a second multiplication at tax time. If you reconstruct mileage from memory in April, a two-rate year makes that guesswork even riskier.
What If You Use the Actual-Expense Method?
The rate change does not affect the actual-expense method, where you deduct the business-use percentage of your real vehicle costs (gas, insurance, repairs, depreciation). But rising fuel prices — the reason for this adjustment — may change which method wins for you this year. If you are eligible for both, it is worth calculating both.
For a full comparison of the two methods, see Standard Mileage vs. Actual Expenses: Which Vehicle Deduction Is Better?.
Reimbursements and Employers
Under an accountable plan, a mileage allowance paid at the IRS standard rate is generally deemed substantiated, so employees do not have to document each actual vehicle cost. The 76-cent rate applies when both the reimbursement is paid on or after July 1, 2026, and the underlying business travel occurs on or after that date. Businesses that reimburse employees at the IRS rate should update their plans accordingly.
Keep Your Records Ready
A mid-year rate change rewards people who track as they go. Simple-C keeps your Schedule C transactions organized by category all year, so your vehicle costs are in one place when it is time to compare methods and apply the right rate to the right miles.
For the rest of your write-offs, read Schedule C Expense Categories: The Complete List.
This article provides general information, not tax advice. Mileage rates and vehicle deduction rules change and depend on your facts. Confirm the current rate and rules with the IRS or a qualified tax professional.