In 2020, IRS mileage rates are $0.575 per mile for business purposes, $0.14 per mile for charity purposes and $0.17 per mile for moving purposes or medical purposes. You must meet certain requirements to deduct mileage, and you must itemize on your tax return to claim the deduction.
In 2019, the IRS mileage rates were $0.58 per mile for business purposes, $0.14 per mile for charity purposes and $0.20 per mile for moving purposes or medical purposes.
If you qualify to deduct mileage, IRS mileage rates are how you calculate how much to reduce your taxable income.
IRS mileage rates 2019 and 2020
Your tax deduction depends on how you used your vehicle. Per the IRS, the rates are:
|2019 tax year||2020 tax year|
|Business miles||58 cents / mile||57.5 cents / mile|
|Medical and moving miles||20 cents / mile||17 cents / mile|
|Charitable miles||14 cents / mile||14 cents / mile|
If you’re self-employed or work as a contractor, you may be able to deduct the cost of the use of your car for business purposes. Commuting to work is generally not deductible mileage.
There are two ways to calculate the deduction for the business use of your vehicle.
1. Standard mileage deduction. This is the most straightforward way of calculating your driving expense: simply multiply the number of business miles by the IRS mileage rate. However, you’ll need keep a record of your business-related mileage.
The rules for business mileage deductions can be complex, especially if you use lots of vehicles for business, just got a new vehicle or leased the vehicle. The IRS website has more details.
2. Actual expenses. If you don’t want to track your mileage, you could track and deduct the actual expenses you incur while using your vehicle for business purposes. These expenses may include:
- Lease payments
- Registration fees
- Gas and oil
- Garage rent
- Parking fees
Mileage deduction for volunteering and charitable activities
If you used your car to help a charity or to go somewhere to volunteer, the mileage can be deductible. You can deduct parking fees and tolls as well.
If you don’t want to deduct your mileage, you can deduct your unreimbursed out-of-pocket expenses, such as gas and oil. However, the expenses have to relate directly to the use of your car in giving services to a charitable organization. Also, you can’t deduct repair and maintenance costs, depreciation, registration fees, tires or insurance.
Mileage deduction for moving
Only active duty members of the military can deduct mileage related to moving. The move has to be related to a permanent change of station.
Mileage deduction for medical situations
If you used your car for medical reasons, you may be able to deduct the mileage. “Medical reasons” includes:
- Driving to the doctor, hospital or other medical facility.
- Driving a child or other person who needs medical care to receive medical care.
- Driving to see a mentally ill dependent if the visits are recommended as part of treatment.
You can deduct parking fees and tolls as well.
If you don’t want to deduct your mileage, you can deduct your unreimbursed out-of-pocket expenses, such as gas and oil. However, the expenses have to relate directly to the use of your car for medical purposes. Also, you can’t deduct repair and maintenance costs, depreciation or insurance.
Mileage isn’t the only transportation cost you might be able to deduct as a medical expense. IRS Publication 502 has the details.
Here’s a big caveat: In general, you can deduct qualified, unreimbursed medical expenses that are more than 7.5% of your adjusted gross income in 2019.
How to claim mileage deductions using IRS mileage rates
If you’re deducting mileage for moving, medical or charity purposes, you’ll need to itemize on your tax return in order to claim the tax deduction for mileage. Itemizing means you’ll need to set aside extra time when preparing your returns to fill out the big enchilada of tax forms: the Form 1040 and Schedule A, as well as supporting schedules that feed into those forms.
If you’re self-employed, you’ll claim your mileage deduction as a business expense on Schedule C.
If you file your taxes online, the software will ask about your mileage during the interview process and calculate the deduction.
Tracking your mileage
This is important because if you’re audited, you may need to substantiate your deduction by showing a log of the miles you drove.
There are lots of ways to keep track of your mileage. Something as simple as keeping a pen and paper in the glove compartment can suffice, but a quick trip to Google or your phone’s app store will reveal a variety of tools that can streamline things.