2024
2023
2022 (July 1 – Dec 31)
2022 (Jan 1 – June 30)
Business
Medical or Moving (Active Duty)
Charitable Service
Applicable IRS Rate: 67.0 cents per mile
Total Miles:0
Rate Applied:$0.670 / mile
Estimated Tax Deduction:$0.00
How Is the IRS Mileage Rate Calculated?
Every year, the Internal Revenue Service (IRS) announces standard mileage rates used to calculate the deductible costs of operating an automobile for business, charitable, medical, or moving purposes. But exactly how is this rate determined? It is not an arbitrary figure; it is based on a rigorous statistical analysis of the costs of driving.
The Calculation Methodology
The IRS does not simply guess the mileage rate. They work with an independent contractor (historically firms like Motus) to conduct an annual study of the fixed and variable costs of operating an automobile.
1. Variable Costs
Variable costs are expenses that increase directly with the number of miles driven. When determining the business mileage rate, the study heavily weighs these factors:
Fuel Prices: The cost of gasoline is the most volatile component. Significant fluctuations in global oil prices often lead to mid-year rate adjustments (as seen in 2011 and 2022).
Maintenance and Repairs: The cost of oil changes, tire rotations, brake replacements, and general mechanical labor.
Tires: The average wear-and-tear cost per mile for tires.
2. Fixed Costs
Fixed costs are expenses that an owner incurs regardless of how many miles are driven. These are factored into the Business rate calculation but are generally excluded from the Medical and Moving rate calculations:
Depreciation: The loss of vehicle value over time is the single largest factor in the standard mileage rate calculation.
Insurance: Average premiums for commercial and personal auto insurance policies.
Registration and License Fees: State and local taxes and fees associated with owning a vehicle.
Business vs. Medical vs. Charitable Rates
You may notice the calculator above provides different rates depending on the purpose of the drive. The IRS uses different formulas for each:
Business Rate: Calculated based on both fixed and variable costs. This is the highest rate because it accounts for depreciation and insurance.
Medical and Moving Rate: Calculated based principally on variable costs (gas and oil). The logic is that you already own the car and pay insurance/depreciation regardless of the medical trip, so you are only reimbursed for the direct cost of that specific drive.
Charitable Rate: This rate is actually set by statute (law), not by the annual IRS study. It has remained fixed at 14 cents per mile for many years and requires legislative action to change.
Standard Mileage vs. Actual Expenses
Taxpayers generally have a choice between using the standard mileage rate (calculated above) or the "Actual Expenses" method. To use the standard rate, you must choose it in the first year you use the car for business. If you choose the actual expenses method, you must track every penny spent on gas, insurance, repairs, and depreciation, and then determine the percentage of business use vs. personal use.
The standard mileage rate is popular because it simplifies record-keeping. Instead of saving every gas receipt, you simply need a compliant logbook tracking the date, miles, and business purpose of every trip.
// Configuration of Historical IRS Rates (in cents)
// Format: Year -> Purpose -> Rate
var irsRates = {
"2024": {
"business": 67.0,
"medical": 21.0,
"charitable": 14.0
},
"2023": {
"business": 65.5,
"medical": 22.0,
"charitable": 14.0
},
"2022_h2": {
"business": 62.5,
"medical": 22.0,
"charitable": 14.0
},
"2022_h1": {
"business": 58.5,
"medical": 18.0,
"charitable": 14.0
}
};
function updateMileageRate() {
var yearSelect = document.getElementById("taxYear");
var purposeSelect = document.getElementById("drivePurpose");
var displayRate = document.getElementById("displayRate");
var selectedYear = yearSelect.value;
var selectedPurpose = purposeSelect.value;
if (irsRates[selectedYear] && irsRates[selectedYear][selectedPurpose]) {
var rateInCents = irsRates[selectedYear][selectedPurpose];
displayRate.innerHTML = rateInCents;
} else {
displayRate.innerHTML = "–";
}
// Hide previous results if inputs change
document.getElementById("result").style.display = "none";
}
function calculateDeduction() {
var yearSelect = document.getElementById("taxYear");
var purposeSelect = document.getElementById("drivePurpose");
var milesInput = document.getElementById("totalMiles");
var selectedYear = yearSelect.value;
var selectedPurpose = purposeSelect.value;
var miles = parseFloat(milesInput.value);
// Validation
if (isNaN(miles) || miles < 0) {
alert("Please enter a valid number of miles.");
return;
}
// Get Rate
var rateInCents = 0;
if (irsRates[selectedYear] && irsRates[selectedYear][selectedPurpose]) {
rateInCents = irsRates[selectedYear][selectedPurpose];
}
// Calculate (Rate is in cents, need to divide by 100 for dollars)
var rateInDollars = rateInCents / 100;
var deductionAmount = miles * rateInDollars;
// Display Results
document.getElementById("resMiles").innerHTML = miles.toLocaleString();
document.getElementById("resRate").innerHTML = "$" + rateInDollars.toFixed(3) + " / mile";
document.getElementById("resTotal").innerHTML = "$" + deductionAmount.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById("result").style.display = "block";
}
// Initialize on load
window.onload = function() {
updateMileageRate();
};