The 2026 IRS Standard Mileage Rate: What Gig Drivers Can Actually Deduct

GigOdo Team · Published July 6, 2026 · Every figure sourced to the IRS unless noted

What is the 2026 rate?

For 2026, the IRS standard mileage rate for business use is 72.5 cents per mile, effective January 1, 2026, per IRS Notice 2026-10. That's a 2.5-cent increase over 2025's 70 cents and the highest business rate the IRS has ever published. The medical and qualified moving rate is 20.5 cents; the charitable rate stays at its statutory 14 cents.

The business rate isn't a guess - the IRS explains in the notice that an independent contractor conducts an annual study of the fixed and variable costs of operating an automobile. When gas, insurance, and car prices rise, the rate follows.

How the rate has climbed

The 2026 rate caps a steep five-year climb: from 56 cents in 2021 to 72.5 cents in 2026, a 29% increase. The IRS even took the rare step of a mid-year hike in 2022. Every year you drove the same miles, they were worth more - if you logged them.

What the math means for a driver

Every 100 business miles is now worth $72.50 off your taxable income. A gig driver logging 15,000 business miles deducts $10,875 in 2026 - $375 more than identical driving was worth in 2025. At 1,000 miles a month, the deduction runs about $725 monthly, which for many drivers wipes out a third or more of their taxable gig profit before a single receipt is involved.

What the rate covers - and what stacks on top

The standard mileage rate substitutes for the actual costs of running the car. Per IRS Tax Topic 510, that means gas, oil, repairs, tires, insurance, registration fees, licenses, and depreciation - you don't deduct those separately, they're baked into the 72.5 cents.

Two things deduct on top of the rate, in the IRS's own words: parking fees and tolls attributable to business use are "separately deductible, whether you use the standard mileage rate or actual expenses." Keep those receipts; they're free money next to your mileage log.

Standard rate or actual expenses?

You can instead deduct actual car costs plus depreciation, but there's a trap: for a car you own, the IRS requires that you choose the standard mileage rate in the first year the car is available for business use. Choose actual expenses in year one, and the standard rate is off the table for that car in every later year. Choose the standard rate first, and you can switch methods later.

Leased cars are stricter: pick the standard rate and you must keep it for the entire lease, renewals included (Tax Topic 510). For most gig drivers in ordinary cars, the standard rate wins on both simplicity and, frequently, dollars - and it makes your quarterly tax estimates far easier to compute.

The hidden line item: depreciation and selling the car

Buried in Notice 2026-10 is a number worth knowing: of the 72.5 cents, 35 cents per mile counts as depreciation for 2026 (33 cents in 2025, 30 in 2024). Each business mile you claim reduces your car's tax basis by that amount, which can affect the gain calculation if you later sell the vehicle. It doesn't change whether the deduction is worth taking - it is - but a driver who claims 15,000 miles a year for several years should expect a lower basis at trade-in time and mention it to their preparer.

Which of your gig miles count

The working consensus among tax professionals: miles driven in the course of working count as business miles - to a pickup, between drop-offs, and repositioning while waiting for the next order. TurboTax's guidance for rideshare drivers lists "the miles you drove returning from drop-off points to a place to wait for another ride request" as deductible.

The caveat is commuting: the same guidance notes the drive home is "generally not deductible since these are considered commuting miles," and the first drive of the day out from home usually gets the same treatment. There's a narrow exception when your home qualifies as your principal place of business (IRS Publication 463's office-in-home rules), but it's fact-specific - assume the first leg out and last leg home don't count unless a tax professional tells you otherwise.

One honest note: the IRS has never published gig-specific guidance on app-on waiting miles, so treat "between-order miles count" as the standard professional position, not settled law - which is one more reason your log needs to be airtight.

Why platform mileage summaries shortchange you

Platform year-end summaries generally cover active trips only. TurboTax puts it flatly for Lyft: "Your Annual Summary won't include the mileage when driving to your first passenger, between passengers and on the way home." The same structure applies to delivery apps - we've broken down the specifics for DoorDash, Uber Eats, and Instacart, where the gap between real and reported miles can run a third or more of a shift's driving. At 72.5 cents each, a 250-mile monthly gap is roughly $2,175 a year of deduction that exists only if you logged it yourself.

The log the IRS actually requires

IRS Publication 463 requires adequate records - an account book, diary, log, trip sheets, or similar record (apps count) - showing, for each business use, the date, mileage, destination, and business purpose. The record must be timely kept, meaning made at or near the time of the trip; Pub 463 treats weekly upkeep as timely. A spreadsheet reconstructed from memory in April is exactly what that standard excludes.

This is where most drivers lose money. A 2016 Kogod Tax Policy Center survey of on-demand platform workers found that 47% didn't know they were entitled to deductions for business expenses like gas, and 36% didn't know what records to keep. The deduction is large, legal, and forfeited by default.

Making the log automatic

A contemporaneous log is a solved problem in 2026: an app that detects your drives and timestamps them satisfies the "at or near the time" standard without you thinking about it. That's what GigOdo does - free, with no trip cap: automatic trip detection, a purpose field on every trip, deduction totals computed at the IRS rate all year, and a CPA-ready report pack at filing time. Your GPS route never leaves your phone; only the mile totals the log requires exist at all.

Bottom line

The 2026 rate is the most valuable the mileage deduction has ever been: 72.5 cents for every business mile you can document. The rate is set; the only variable is your log. Start it before your next shift - at these rates, every unlogged 100 miles costs you $72.50.

FAQ

Sources: IRS Notice 2026-10; IRS newsroom IR-2025-128; IRS standard mileage rates; IRS Tax Topic 510; IRS Publication 463; TurboTax rideshare guidance; Bruckner, "Shortchanged," Kogod Tax Policy Center (2016). This article is general information, not tax advice.