Mileage deduction calculator for freelancers

Standard mileage is 76¢/mi in 2026 — but actual expenses sometimes beat it.

You can deduct driving for work two ways: a flat rate per business mile, or the real business share of your actual vehicle costs. Which is bigger depends on your miles and your expenses.

Enter your numbers and this calculator works out both methods, tells you which wins, and estimates the tax it saves at your marginal rate.

Two ways to deduct driving for work

If you drive your own car for business, the IRS lets you deduct that use — but you pick one of two methods, and you must use the same one for a given vehicle for its whole first year of use.

The standard mileage method is a flat rate per business mile (72.5¢ for miles in early 2026, 76¢ for miles from July 1, 2026). Multiply business miles by the rate and you are done. The actual expense method makes you add up the real costs of the vehicle — gas, insurance, repairs, registration, depreciation, lease or loan interest — and deduct only the business share of each.

Which one is bigger

The standard method wins for most freelancers because it is simple and the rate is set generously to cover both fixed and variable costs. The actual method tends to win only when you drive an expensive or gas-hungry vehicle a lot for work, or when your annual expenses are high relative to the business share.

The crossover is the business-use percentage. If you drive 12,000 miles a year and only 1,000 are for business, your business share is under 10% — the actual method would need enormous total expenses to beat the standard rate on those 1,000 miles. If you are a rideshare or delivery driver putting 30,000 business miles on a car, the actual method’s depreciation and high gas spend can overtake standard. The calculator shows the exact crossing point for your numbers.

The business-use share is the lever

Under the actual method you deduct only the percentage of driving that is for work, so the single most important input is your business-use share. Commuting to a regular workplace does not count as business miles; driving from your home office to a client does. Keeping a mileage log — date, miles, purpose — is what lets you defend that percentage if the IRS ever asks, and it is required if you use the actual method at all.

The first-year trap

This is the rule people miss: you must use the standard mileage method in the first year you claim a vehicle. Only after that first year can you switch to actual. So if you think your actual costs will be high, you cannot jump straight to them — you are locked into standard for year one. The choice then recurs each subsequent year, and once you use actual you generally stay with actual. Plan the vehicle’s first year accordingly.

What the deduction is worth

Like the home office deduction, this is a deduction, not a refund. Its cash value is the deduction times your marginal tax rate. At 22% federal, a $7,600 standard-method deduction is worth about $1,670 — and a bit more if your state also lets you deduct it. Some states do not conform to the federal mileage method, so check your state’s treatment.

Record-keeping that survives an audit

The standard method still requires a log of business miles; you just do not need receipts for gas and repairs. Apps that track mileage automatically are fine as long as they record date, distance, and purpose. The audit risk is almost never the rate — it is an unsupported business-use percentage — so the log is the one thing worth doing properly.