IRS Increases Standard Business Mileage Rate to 76 Cents Per Mile Beginning July 1, 2026

The IRS has announced an increase to the standard business mileage rate for the second half of 2026. Effective July 1 through December 31, 2026, the standard mileage rate for business use of a personal vehicle is 76 cents per mile, up from 72.5 cents per mile during the first half of the year. The previous rate remains in effect for business travel between January 1 and June 30, 2026. For a complete overview of the rates originally announced for the year, read our guide to the 2026 IRS mileage rates.

The updated rate applies to transportation expenses for vehicles powered by gasoline, diesel, hybrid-electric, and fully electric vehicles.

What Employers Need to Know

The standard mileage rate is commonly used to reimburse employees who use their personal vehicles for business travel. Employers using the IRS standard rate should update their reimbursement policies and payroll processes to reflect the new rate for travel beginning July 1.

For 2026:

• January 1 – June 30: 72.5 cents per business mile
• July 1 – December 31: 76 cents per business mile

The IRS also increased the standard mileage rate for qualified medical and military moving travel to 23.5 cents per mile, effective July 1, 2026. (The moving expense rate applies only to eligible active-duty military members and certain members of the intelligence community.)

Keeping up with IRS changes is an important part of maintaining accurate payroll and expense reimbursement practices. Ahola helps employers stay current on federal and state payroll requirements, so you can spend less time tracking regulatory updates and more time focused on your business.

For additional details, review the official IRS guidance in Announcement 2026-11 and Internal Revenue Bulletin 2026-29.