December 23, 2024 | Category: Uncategorized

The IRS has announced its annual optional standard mileage rates for 2025. The standard mileage rate is a benchmark used by many businesses to reimburse their employees for the costs of operating an automobile for business, charitable, medical or moving purposes. The IRS adjusts the standard mileage rate annually to reflect the fluctuating costs of operating a vehicle.

person driving; view of car dashboard

Beginning January 1, 2025, the optional standard mileage rates are as follows:

  • 70 cents per mile driven for business use (up 3 cents from 2024)
  • 21 cents per mile driven for medical purposes (no change from 2024)
  • 21 cents per mile driven for moving purposes for qualified active-duty members of the Armed Forces (no change from 2024)
  • 14 cents per mile driven in service of charitable organizations

The standard mileage rate for business use is based on an annual study of the fixed and variable costs of operating an automobile, including gas, insurance, maintenance, and depreciation. The rate for medical and moving purposes is based on the variable costs. The charitable rate is set by statute. These rates apply to electric and hybrid-electric vehicles as well as gasoline and diesel-powered vehicles.

Using the standard mileage rates are optional. Taxpayers always have the option of calculating the actual costs of using their vehicle rather than using the standard mileage rates.