IRS Mileage Reimbursement 2025 | Full Details

For the 2025 tax year, the IRS has set the following standard mileage reimbursement rates (effective January 1, 2025):

📌 What This Means

• Use 70 cents per mile for business-related driving—e.g., meetings, deliveries, visiting clients.

• Use 21 cents per mile for medical purposes or moving (for active-duty military only).

• Use 14 cents per mile when driving for qualified charitable activities.

You can either apply the standard mileage rate or calculate your actual vehicle expenses (fuel, depreciation, insurance), but you can’t use both methods at once.

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💼 Practical Tips

1. Businesses: If reimbursing employees, setting rates above IRS limits is allowed—but you can only deduct what you actually pay.

2. Employees/Self-Employed:

   • Track miles carefully (date, purpose, start/end).

   • Apply the 70¢ rate for business miles.

   • Log medical or charitable miles with their respective rates.

   • Keep thorough records for tax returns using Form 2106 (if applicable).

3. Leased Vehicles: If opting for standard mileage, it must be used throughout the lease term.

🧠 Why the Rates Change

The IRS annually adjusts the business rate based on studies of vehicle operating costs (fuel, maintenance, depreciation, etc.). The jump to 70¢ acknowledges rising expenses. Charitable and medical/move rates are adjusted differently—charity is fixed by law, and medical/move only reflect variable costs.

✅ Summary

• 2025 IRS Mileage Rates:

  • Business: 70¢/mile

  • Medical/military moving: 21¢/mile

  • Charity: 14¢/mile

• Effective Jan 1, 2025; use the rate corresponding to your mileage’s purpose.

• Keep accurate mileage logs and choose your deduction method wisely.