The IRS business standard mileage rate is 76 cents per mile for miles driven from July 1 through December 31, 2026, up from 72.5 cents for the first half of the year. For service vendors who charge travel fees, the rate is the cost floor your travel pricing should clear, and the midyear change means your 2026 mileage log needs one rate per half, not one rate for the year.
Key takeaways
- The business standard mileage rate is 76 cents per mile for the second half of 2026, and 72.5 cents for the first half.
- Track mileage separately for each half of the year so the correct rate applies.
- Your travel fee should clear the real cost of driving, now at least 76 cents per mile for second half miles.
- Whether you fold mileage into your base rate or bill it per mile, the terms belong in the quote and the contract.
Understanding the midyear change
The midyear change in the business standard mileage rate means that for a 2026 mileage log, you calculate your deductible miles at 72.5 cents per mile for miles driven from January 1 through June 30, and 76 cents per mile for miles driven from July 1 through December 31. If you track mileage in a log or an app, split the year at June 30 so each half carries its own rate. You can find the official figures on the IRS website.
One clarification worth making: the IRS rate is a deduction benchmark, not a price you must charge clients. It tells you what the tax code treats as the cost of driving a mile. Your travel fee is a business decision, and it should at least clear that floor.
Fold mileage into the base rate, or bill it separately?
Fold it in when travel is predictable and short: the jobs inside your home territory. A base rate that quietly assumes local driving keeps the quote to one number, and one number converts better than a quote with three lines of distance math.
Bill it separately when distance varies job to job: destination weddings, rural venues, days with multiple stops. A per mile line beyond a free radius keeps your base rate competitive for local clients while making distant jobs pay their real cost.
Many vendors run both at once: a base rate that assumes local travel, plus a stated per mile charge beyond a set radius. Whatever you choose, the client should see it in writing before signing, not for the first time on the final invoice.
Setting your per mile travel fee
The real cost of driving includes fuel, maintenance, insurance, and depreciation, and the new 76 cent rate is the tax code's current estimate of that cost. Your travel fee should clear that floor, and many vendors charge well above it, commonly somewhere in the rough range of $1.50 to $2.50 per mile beyond a free radius, because the fee also covers time on the road, tolls, parking, and wear on the vehicle. If you charge a flat travel fee instead, review it against the new floor and adjust if it no longer covers your costs.
Research what vendors in your area and your trade charge so your travel line stays competitive, and state the number the same way every time so clients can compare quotes fairly.
How to write travel terms into the quote and the contract
Travel terms work when they state four things in plain language:
- The free radius, if any, measured from your base.
- The per mile rate beyond it, and whether it is billed one way or round trip.
- What else travel covers: tolls, parking, and lodging past a stated distance.
- When the travel line is due, usually with the final balance.
Put the same terms in the quote and in the signed contract so the invoice is never a surprise. The contract templates give you clause structure, how contracts work covers the signing flow, and the invoice generator produces a clean line item when the job is done.
Worked example: a 140 mile round trip
Assumptions, stated: a vendor with a 25 mile free radius each way, a $1.50 per mile travel charge beyond it, and a job 70 miles from base, so 140 miles round trip, all driven in the second half of 2026.
- Billable distance: (70 minus 25) x 2 = 90 miles.
- Travel fee on the quote: 90 x $1.50 = $135.
- Mileage deduction for the log: 140 x $0.76 = $106.40, because the deduction covers every business mile, including the free radius miles.
Two numbers come out of the same trip, and both matter. The $135 is revenue the client agreed to in writing. The $106.40 is the deduction your mileage log supports at tax time, assuming the miles qualify and your records hold up. For the bigger picture on what this income means for your tax bill, the self employment tax calculator and the quarterly estimated tax calculator help you plan.
Record keeping for the deduction
The standard mileage deduction lives or dies on the log. As a general pattern, keep for each trip the date, the destination or business purpose, and the miles driven, recorded close to the trip rather than reconstructed in April. Split your 2026 log at June 30 so each half carries its own rate, 72.5 cents before and 76 cents after. A tracking app or a simple spreadsheet both work; consistency is what counts. This is general information, not tax advice, and a tax professional can confirm what your records need.
FAQ
What is the new business standard mileage rate, and when does it take effect?
The rate is 76 cents per mile for business miles driven from July 1 through December 31, 2026. Miles driven from January 1 through June 30, 2026 use the earlier 72.5 cent rate, so a 2026 mileage log needs one rate per half.
Should I charge clients the IRS rate per mile?
The IRS rate is a deduction benchmark, not a market price. Many vendors charge more per mile because the travel fee also covers time on the road, tolls, and vehicle wear. The number that matters is the one your contract states and your local market supports.
Is it better to fold mileage into my base rate or bill it separately?
Fold it in when travel is short and predictable, so the quote stays one number. Bill it separately, usually as a per mile charge beyond a free radius, when distance varies widely between jobs. Many vendors use both: local travel assumed, distance billed.
What records do I need for the mileage deduction?
As a general pattern, a log with the date, destination or business purpose, and miles for each trip, kept as you go. Split the 2026 log at June 30 so each half carries the correct rate. A tax professional can confirm what your situation requires.
Where can I find the official rate and rules?
The IRS website publishes the standard mileage rates and the rules around them. For how the deduction applies to your business, consult a tax professional, because the right treatment depends on your records and your entity. Rates can change again, so check the current figure before setting next year's travel pricing.
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