2025 mileage rates in the United States

As the new tax year begins, it's important to familiarize yourself with the mileage rates and calculations applicable to your business-related driving in the United States. In the 2025 tax year, the Internal Revenue Service (IRS) has set the following mileage rates:

1. For business purposes: 70 cents per mile.
2. For medical and moving purposes: 21 cents per mile.
3. For charitable purposes: 14 cents per mile.

The IRS defines business mileage as the mileage driven between two places of work, whether they are permanent or temporary. There are several common types of trips that are considered business-related, including:

1. If you have multiple work locations, the mileage between these locations is considered business mileage.
2. If you need to travel to meet clients or visit customers for business purposes, the mileage for these trips is considered business mileage.
3. If you need to run errands directly related to your business, such as picking up supplies or delivering documents, the mileage for these errands is considered business mileage.

Calculation of reimbursement or deduction

To understand how the calculation works, consider the following example: Suppose you have traveled a total of 1,000 miles for business-related purposes during the tax year.

For business mileage reimbursement or deduction based on the IRS requirements, the rate is 70 cents per mile. By applying the IRS rate, your eligible reimbursement or deduction would be $700 (1,000 miles x $0.700).

Record-Keeping and documentation

Remember, maintaining accurate records and documentation is essential when claiming mileage reimbursement or deductions. This includes keeping track of your business-related mileage, documenting the purpose of each trip, and retaining receipts for any additional expenses such as parking fees or tolls.

By understanding the mileage rates and guidelines set by the IRS, you can effectively navigate the process of claiming mileage reimbursement or deductions in the 2025 tax year. Should you require further assistance or have specific questions related to your circumstances, consider consulting a tax professional or contacting the IRS directly for personalized guidance.