Standard Mileage Rate

Definition

The standard mileage rate is an IRS-approved cents-per-mile figure that taxpayers can use to calculate deductible vehicle expenses instead of tracking actual costs like gas, insurance, and repairs. The IRS sets the rate annually based on fixed and variable vehicle operating costs, and in rare cases issues a mid-year adjustment when fuel or other costs shift significantly. Business owners, self-employed individuals, and employees with unreimbursed vehicle use are among those who may use this method.