Mileage Reimbursement Calculator

What is the 2026 IRS standard mileage rate?

The IRS issued Notice 2026-10 on December 29, 2025 (IR-2025-128), setting the 2026 optional standard mileage rates at 72.5¢/mile for business use (up 2.5¢ from 2025), 20.5¢/mile for medical and active-duty military moving (down 0.5¢), and 14¢/mile for charitable use (statutorily fixed by 26 USC §170(i) since 1998). Of the 72.5¢ business rate, 35¢ represents depreciation. The maximum standard automobile cost under a Fixed-and-Variable-Rate (FAVR) plan in 2026 is $61,700.

Source: IRS — 2026 business standard mileage rate · Notice 2026-10 (PDF)

Does the IRS rate apply to mileage paid in 2026 for miles driven in 2025?

No. The IRS Notice that promulgates each year's rate is effective for travel "on or after January 1, [year]" through December 31 of that year. A reimbursement paid in 2026 for miles driven in 2025 uses the 2025 rate (70¢/mile), not 2026 (72.5¢). The rate follows the mile, not the payment. The calculator surfaces year as a required input to make this explicit.

Is an employer required to pay the IRS standard mileage rate?

No federal law requires employers to reimburse mileage at any rate. The IRS rate is a safe-harbor tax treatment, not a reimbursement requirement. 29 CFR §531.35 (the FLSA "free and clear" rule) is the only federal protection — unreimbursed expenses cannot drop wages below the $7.25/hr federal minimum. Six states impose a broad reimbursement duty: California (Labor Code §2802), Illinois (820 ILCS 115/9.5), Montana (MCA §39-2-701), New Hampshire (RSA 275:57), North Dakota (NDCC §34-02-01), and South Dakota (SDCL §60-2-1). Massachusetts has a narrower transportation-only duty under 454 CMR 27.04(4). Everywhere else, the duty arises only from contract.

Source: 29 CFR §531.35 · California Labor Code §2802

What is the California §2802 gap shown in California mode?

California Labor Code §2802 requires employers to indemnify employees for "all necessary expenditures or losses." Per Gattuso v. Harte-Hanks Shoppers, 42 Cal.4th 554 (Cal. 2007), the IRS rate is one of three permissible methods of reimbursement and is "presumptively reasonable" — but an employee can challenge adequacy by proving actual costs exceeded the reimbursement. The calculator surfaces the AAA "Your Driving Costs" weighted-average per-mile figure ($11,577 annual / 15,000 miles = 77.18¢/mile for 2025) as the default actual-cost benchmark. The gap between the IRS rate (72.5¢ in 2026) and the AAA average is the §2802 exposure for a California employer paying at the IRS rate alone.

Source: Gattuso v. Harte-Hanks Shoppers, 42 Cal.4th 554 (Cal. 2007) · AAA — 2025 New Vehicle Costs ($11,577)

Is a mileage reimbursement taxable income?

Reimbursement at or below the IRS rate under an accountable plan (26 CFR §1.62-2) is excluded from W-2 wages and not subject to payroll tax. Three elements: business connection, substantiation (amount, time, place, business purpose per 26 CFR §1.274-5), and return of excess within a reasonable time. Reimbursement above the IRS rate is taxable W-2 income for the excess unless the employee substantiates the higher actual costs separately. As of January 1, 2026, W-2 employees cannot deduct unreimbursed business expenses on their federal return — IRC §67(g) was made permanent by the One Big Beautiful Bill Act (2025).

Source: 26 CFR §1.62-2 (accountable plans) · OBBBA provisions overview

Are commuting miles between home and work reimbursable?

No. Per IRC §262 and Commissioner v. Flowers, 326 U.S. 465 (1946), commuting between an employee's home and a regular workplace is personal expense, not business expense — and is neither deductible nor reimbursable under an accountable plan. Travel between two work locations on the same day IS deductible business mileage. Travel from home to a temporary work location outside the metro area is also deductible per Rev. Rul. 99-7 (defining "temporary" as employment at a location realistically expected to last one year or less). The calculator assumes you've already filtered your mileage log to business miles only — it cannot detect commuting from input alone.

Source: Commissioner v. Flowers, 326 U.S. 465 (1946) · Rev. Rul. 99-7

What records do I need to claim the IRS rate?

Per 26 CFR §1.274-5(c), each business-mileage entry needs four elements: amount (miles driven), date, place (destination), and business purpose. A contemporaneous log made at or near the time of the trip has "a high degree of credibility." Reconstructed logs are permitted but heavily disfavored — the IRS will challenge them, and the Cohan-rule estimation doctrine has been largely supplanted by the strict substantiation requirement under IRC §274(d) for passenger automobiles. Most mileage-tracking apps (and Clockspot's timesheet with geofenced clock-in) maintain the log automatically.

Source: 26 CFR §1.274-5 (substantiation)