IRS Mileage Rate Increase 2025 Calculator
Compare 2024 vs. 2025 tax deduction rates
Understanding the 2025 IRS Mileage Rate Changes
The Internal Revenue Service (IRS) has officially announced the optional standard mileage rates for 2025. These rates are used to calculate the deductible costs of operating an automobile for business, charitable, medical, or moving purposes. For 2025, several key adjustments have been made to reflect the changing costs of fuel and vehicle maintenance.
Standard Mileage Rates for 2025 vs. 2024
Keeping track of these adjustments is crucial for small business owners, freelancers, and healthcare patients who rely on mileage reimbursements or tax deductions.
- Business: Increased to 67.5 cents per mile (up from 67 cents in 2024).
- Medical & Moving: Decreased to 19 cents per mile (down from 21 cents in 2024).
- Charitable: Remains static at 14 cents per mile (set by statute).
How the Calculator Works
To use the IRS Mileage Rate Increase 2025 Calculator, simply enter the total number of miles you expect to drive during the calendar year. Select the category that matches your trip's purpose. The tool will automatically apply the following logic:
- Identify the Rate: It pulls the 2024 and 2025 cents-per-mile values for your specific category.
- Calculate Total: It multiplies your total miles by each year's respective rate.
- Analyze Change: It calculates the net increase (or decrease) in your potential tax deduction.
Example Scenario
If you drive 10,000 miles for business in 2024, your deduction is $6,700. In 2025, the same 10,000 miles results in a deduction of $6,750. This represents a $50 increase in your tax-deductible expenses for the year, helping to offset rising insurance and maintenance costs.
Compliance and Record Keeping
To claim these deductions, the IRS requires taxpayers to maintain accurate records. You should keep a daily log that includes the date, the destination, the business purpose, and the odometer readings at the start and end of each trip. Using a digital mileage tracking app is highly recommended to ensure you meet the strict documentation standards required for a potential audit.