Tax glossary

Standard Mileage Deduction

Standard Mileage Deduction — what it means, how it works, and a real example, explained without the jargon.

What is Standard Mileage Deduction?

The standard mileage deduction lets you write off business driving at a set per-mile rate instead of tracking every actual vehicle cost.

How it works

You multiply your business miles by the IRS rate for the year. It covers gas, maintenance, insurance, and depreciation all in one figure. The alternative — the actual-expense method — deducts the real costs times your business-use percentage.

A quick example

Drive 8,000 business miles at a ~67¢ rate and you deduct about $5,360 — no fuel or repair receipts needed, just the mileage log.

What people get wrong

The deduction lives or dies on your log. Record the date, miles, and purpose of each trip contemporaneously — a reconstructed "guesstimate" is exactly what the IRS disallows on audit.

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Frequently asked questions

What does Standard Mileage Deduction mean?

The standard mileage deduction lets you write off business driving at a set per-mile rate instead of tracking every actual vehicle cost.

How does Standard Mileage Deduction work?

You multiply your business miles by the IRS rate for the year. It covers gas, maintenance, insurance, and depreciation all in one figure. The alternative — the actual-expense method — deducts the real costs times your business-use percentage.

What's the most common mistake with standard mileage deduction?

The deduction lives or dies on your log. Record the date, miles, and purpose of each trip contemporaneously — a reconstructed "guesstimate" is exactly what the IRS disallows on audit.