# Mileage Deduction Calculator for Contractors (2026)

The mileage deduction lets you write off business driving at an IRS rate per mile instead of tracking every vehicle cost. For 2026 the IRS set two business rates: 72.5 cents a mile for January through June and 76 cents for July through December. Multiply each half's business miles by its rate and add parking and tolls.

## Key takeaways

- 2026 business standard mileage rate: 72.5 cents (Jan. 1 – June 30) and 76 cents (July 1 – Dec. 31). The 2025 rate was 70 cents.
- Business miles only: trips between job sites, to supply houses and to customers. Commuting to a regular workplace doesn't count, even with a truck full of tools.
- You can use the standard rate or actual expenses. To use the standard rate on a vehicle you own, choose it in the first year the vehicle is used for business.
- Business parking and tolls are deductible on top of either method.
- Keep a mileage log written at or near the time of each trip.

> **Estimate, not tax advice**
>
> This tool applies the 2026 IRS business standard mileage rates. The actual expense comparison is simplified: it applies your business-use share to the costs you enter and doesn't apply depreciation limits or prior-year depreciation. Ask a CPA or enrolled agent before switching methods.

## How do you calculate the mileage deduction for 2026?

Multiply business miles driven from January 1 to June 30 by 72.5 cents, multiply business miles from July 1 to December 31 by 76 cents, then add business parking fees and tolls. The IRS raised the rate mid-year in [Announcement 2026-11](https://www.irs.gov/irb/2026-29_irb), citing higher fuel prices, so your log needs to show which miles fall on each side of June 30.

**Formula**

```
Deduction = M₁ × $0.725 + M₂ × $0.76 + parking and tolls
```

Where:
- M₁ = business miles driven Jan. 1 – June 30, 2026
- M₂ = business miles driven July 1 – Dec. 31, 2026

1. **Pull your mileage log.** Use a written log or a GPS mileage app. Each entry needs the date, where you went, the business purpose and the miles.
2. **Split the year at June 30.** Total business miles for January–June and for July–December separately. If the year isn't over, estimate the rest from last year's pattern.
3. **Multiply by each rate.** January–June miles × 72.5 cents; July–December miles × 76 cents.
4. **Add parking and tolls.** Business parking and tolls are deductible on top of the standard rate. Parking at your regular workplace isn't.
5. **Compare with actual expenses.** Enter your yearly vehicle costs and total miles. The calculator shows which method gives the bigger deduction this year.

> **Worked example**
>
> A roofer drives 9,000 business miles in the first half of 2026 and 11,000 in the storm-heavy second half, out of 26,000 total miles on the truck.
>
> Standard rate: 9,000 × 72.5 cents = $6,525, plus 11,000 × 76 cents = $8,360, plus $300 of parking and tolls = **$15,185**.
>
> Actual expenses: $14,000 of yearly truck costs × 76.9% business use + $300 = $11,069. The standard rate wins by $4,116.
>
> In the 22% bracket, with self-employment tax on top, that deduction is worth roughly $5,486 in federal tax.

## How much is the mileage deduction worth?

**2026 standard mileage deduction at common business mileages**

| Business miles in 2026 | Jan–June half | July–Dec half | Deduction |
| --- | --- | --- | --- |
| 5,000 | $1,813 | $1,900 | $3,713 |
| 10,000 | $3,625 | $3,800 | $7,425 |
| 15,000 | $5,438 | $5,700 | $11,138 |
| 20,000 | $7,250 | $7,600 | $14,850 |
| 30,000 | $10,875 | $11,400 | $22,275 |
| 40,000 | $14,500 | $15,200 | $29,700 |

_Assumes miles are split evenly between the two halves of 2026. Rates: 72.5 cents and 76 cents (IRS Notice 2026-10 and Announcement 2026-11). Parking and tolls not included._

## Which miles count as business miles for a contractor?

Business miles are trips you make for the business: from one job site to another, to the supply house, to a customer's home for an estimate, to the bank to deposit checks. Driving between your home and your main or regular place of work is commuting, and the IRS doesn't allow it no matter how far it is.

- **Home office as principal place of business.** If your home office qualifies as your principal place of business, trips from home to job sites and other work locations are generally deductible.
- **Temporary job sites.** If you have a regular shop or yard away from home, daily round trips from home to a temporary job site in the same trade are generally deductible, regardless of distance.
- **Hauling tools.** Carrying tools or ladders while commuting doesn't make the trip deductible. Extra costs, like renting a trailer, can be.
- **Mixed trips.** A stop at the supply house on the way home doesn't turn the whole commute into business miles.

## Standard mileage rate vs. actual expenses: which is better?

The standard rate usually wins for fuel-efficient vehicles that rack up a lot of business miles. Actual expenses can win for a heavy, expensive truck with high fuel, insurance and repair costs, especially in the first year when depreciation is large. Run both in the calculator, but know the rules before you pick.

**Rules that decide which method you can use**

| Rule | What it means |
| --- | --- |
| Choose the standard rate in year one | For a vehicle you own, you must use the standard rate in the first year the vehicle is used in your business to keep the option later. |
| Leased vehicles | If you choose the standard rate for a leased vehicle, you must use it for the entire lease, including renewals. |
| Five or more vehicles | You can't use the standard rate if you operate five or more vehicles at the same time, as in a fleet. |
| Depreciation already taken | You can't switch to the standard rate on a vehicle after claiming Section 179, bonus depreciation or MACRS depreciation on it. |
| Parking and tolls | Deductible under either method. |

_Source: IRS Topic No. 510, Business Use of Car. Heavy trucks with large Section 179 write-offs belong in the [Section 179 calculator](https://www.brix.so/tools/section-179-calculator)._

## What records do you need for the mileage deduction?

Keep a log made at or near the time of each trip: date, destination, business purpose and miles, plus odometer readings at the start and end of the year. For 2026, also note the odometer on June 30 so you can split miles between the two rates. A phone app or your dispatch history can fill most of this in.

## Common mistakes

- **Using one rate for all of 2026.** Miles from July 1 on use 76 cents, not 72.5 cents.
- **Counting the commute.** Home to your regular shop is personal, even if you drive a work truck.
- **Reconstructing the log in April.** A log rebuilt from memory is weak in an audit. Record trips as you go.
- **Switching methods without checking.** Claiming Section 179 on a truck rules out the standard rate on that truck later.
- **Mixing personal and business on one card.** It makes the actual-expense split harder to prove.

BRIX keeps your schedule and job addresses in one place and syncs categorized vehicle expenses to QuickBooks, so the trips and costs behind your mileage deduction are already on record when tax time comes. BRIX doesn't file taxes or give tax advice.

- [Scheduling and dispatch](https://www.brix.so/features/scheduling-dispatch): Assigns the right crew to the right job based on skills, location and availability.
- [Bookkeeping and tax help](https://www.brix.so/features/bookkeeping-taxes): Keeps expenses categorized, tracks 1099 subcontractors and sales tax, and reminds you of quarterly estimated tax dates. BRIX does not file taxes or give tax advice.
- [QuickBooks sync](https://www.brix.so/integrations/quickbooks): Syncs customers, invoices and payments with QuickBooks so the books match the jobs.

## Frequently asked questions

### What is the IRS mileage rate for 2026?

The 2026 business rate is 72.5 cents per mile for miles driven January 1 through June 30, and 76 cents per mile from July 1 through December 31. The IRS raised it mid-year in Announcement 2026-11.

### Why are there two mileage rates in 2026?

The IRS set 72.5 cents in Notice 2026-10, then raised the rate to 76 cents for miles from July 1, 2026, citing higher fuel prices. Miles before July 1 still use the original rate.

### Can I deduct mileage from home to a job site?

It depends on where your regular place of work is. If your home office is your principal place of business, trips from home to job sites are generally deductible. If you report to a regular shop or yard, home to a temporary job site in the same trade is generally deductible too, but home to the shop is commuting.

### Can I take the mileage deduction and depreciation on my truck?

Not both. The standard mileage rate already includes an amount for depreciation. If you claim Section 179, bonus or MACRS depreciation on a vehicle, you can't use the standard rate for it later.

### Is the standard mileage rate or actual expenses better for a work truck?

Run both. High-mileage, fuel-efficient vehicles usually do better with the standard rate. A heavy, expensive truck with large first-year depreciation often does better with actual expenses. The calculator compares the two for this year.

### Does the mileage deduction reduce self-employment tax?

Yes, for sole proprietors. Mileage is a business expense on Schedule C, so it lowers the net profit that both income tax and self-employment tax are figured on.

## Related

- [Mileage Deduction for Contractors: 2026 Rates and Rules](https://www.brix.so/learn/mileage-deduction-for-contractors)
- [Section 179 Calculator for Trucks, Vans and Equipment (2026)](https://www.brix.so/tools/section-179-calculator)
- [Contractor Tax Deductions: The Complete List for 2026](https://www.brix.so/learn/contractor-tax-deductions-list)
- [Self-Employment Tax Calculator (2026)](https://www.brix.so/tools/self-employment-tax-calculator)
- [Quarterly Estimated Tax Calculator for Self-Employed Contractors (2026)](https://www.brix.so/tools/quarterly-estimated-tax-calculator)
- [What Is Depreciation?](https://www.brix.so/learn/depreciation)
- [Can a Contractor Claim the Home Office Deduction?](https://www.brix.so/learn/home-office-deduction-for-contractors)
- [Bookkeeping for contractors that keeps your books tax-ready all year](https://www.brix.so/features/bookkeeping-taxes)
- [Quarterly Estimated Taxes for Contractors: How They Work in 2026](https://www.brix.so/learn/quarterly-estimated-taxes-for-contractors)
- [How Much Should You Set Aside for Taxes When You're Self-Employed?](https://www.brix.so/learn/how-much-to-set-aside-for-taxes)

## Sources

- [IRS, Standard mileage rates](https://www.irs.gov/tax-professionals/standard-mileage-rates) (checked 2026-10-12)
- [IRS Announcement 2026-11 (Internal Revenue Bulletin 2026-29), revised 2026 mileage rates](https://www.irs.gov/irb/2026-29_irb) (checked 2026-10-12)
- [IRS news release IR-2025-128 and Notice 2026-10, 2026 standard mileage rates](https://www.irs.gov/newsroom/irs-sets-2026-business-standard-mileage-rate-at-725-cents-per-mile-up-25-cents) (checked 2026-10-12)
- [IRS Topic No. 510, Business Use of Car](https://www.irs.gov/taxtopics/tc510) (checked 2026-10-12)
- [IRS Publication 463, Travel, Gift, and Car Expenses](https://www.irs.gov/publications/p463) (checked 2026-10-12)

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Written by BRIX Editorial Team. Last updated 2026-10-12. General information, not tax, legal or financial advice.
Canonical: https://www.brix.so/tools/mileage-deduction-calculator