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2025 Mileage Rates Announced by IRS

2025 Mileage Rates Announced by IRS

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At the end of December, the IRS announced standard mileage rates for 2025. Below are the deductions, if you are using an automobile for approved purposes:

  • Self-employed and business: 70 cents/mile (up from 67 cents in 2024)
  • Charities: 14 cents/mile (unchanged from 2024)
  • Medical: 21 cents/mile (unchanged from 2024)
  • Moving (military only): 21 cents/mile (unchanged from 2024)

It gets complicated

Before filing your claim, it’s essential to review the fine print. For instance, the IRS states that if your car is used solely for business purposes, you may be eligible to deduct the full cost of ownership and operation (subject to specific limits). However, if the car serves both business and personal purposes, only the expenses related to business use are deductible.

The IRS notes that you can typically calculate your deductible car expenses using one of two methods: the standard mileage rate method or the actual expense method. If you qualify for both, it’s wise to calculate your deduction using each method to determine which yields the greater benefit.

Further details are available on the IRS site, Topic no. 510, Business use of car. You should discuss your situation with a tax professional.

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