IRS Releases 2026 Mileage Reimbursement Rate

| written by Jennifer Woo Burns, Principal Attorney

The Internal Revenue Service (IRS) has announced the standard mileage rates for 2026, effective January 1. Employers are required to reimburse employees for reasonable expenses when they use their personal vehicles for work purposes, such as offsite meetings, training, and work-related errands, excluding normal commuting. This reimbursement allowance is intended to cover costs like maintenance, fuel, and insurance for miles driven for business use. However, exceptional circumstances may require employers to cover additional actual expenses incurred by the employee.

2026 Rates

  • 72.5 cents per mile driven for business use, up 2.5 cents from 2025.
  • 20.5 cents per mile driven for medical purposes, down a half cent from 2025.
  • 20.5 cents per mile driven for moving purposes for certain active-duty members of the Armed Forces (and now certain members of the intelligence community), reduced by a half cent from last year.
  • 14 cents per mile driven in service of charitable organizations, equal to the rate in 2025.

Internal Revenue Service. (2026, January 1). Standard mileage rates for 2026. Retrieved from https://www.irs.gov

What should employers do now?

Update your mileage reimbursement rate and review your expense reimbursement policies to ensure they also cover other reasonable travel-related expenses, such as meals, travel fare, remote device use, and incidental costs. Remember that time spent traveling when employees are not free to engage in personal activities, such as time in transit, is generally compensable. Non-exempt employees should record travel time accurately to ensure proper compensation.

Employers should consult legal counsel when preparing compliant expense reimbursement policies. Our team at Scali Rasmussen is here to help you navigate these updates and maintain compliance with confidence.