I know that tracking mileage is one of those annoying administrative tasks that
feels like a waste of time when you’re busy running a business. You get in the car,
you’re thinking about your next client meeting or the job site you’re heading to, and
writing down your odometer reading is the last thing on your mind.
I get it. It feels tedious.
But here’s the reality of the situation: if you aren’t tracking those miles, you are literally
leaving thousands of dollars on the table come tax season. And even worse, you’re
handing the IRS an easy win if they ever decide to look at your return.
Let me walk you through why this matters more than ever right now, and how we can
make it painless for you.
Big News: The IRS Just Raised the Rates
Here’s some good news for a change. The IRS recently announced the standard mileage
rates for 2026, and they’ve gone up.
For 2026, the standard mileage rate is 72.5 cents per mile.
That’s up 2.5 cents from last year.
That might sound like loose change, but it adds up fast. I’ll show you the math in a
minute, but first, I want you to understand your options.
Two Ways to Deduct: Choose Your Adventure
You might be thinking there’s only one way to do this, but you actually have a choice.
When we prepare your taxes, we can use one of two methods:
- Standard Mileage Rate: This is the simple one. You track your business miles, and
we multiply that total by 72.5 cents. This rate is designed to cover gas, insurance,
wear and tear—everything. - Actual Expenses: This is exactly what it sounds like. We track every single penny
you spend on that vehicle:
Gas and oil
Tires and repairs
Maintenance and car washes
Insurance and registration fees
Depreciation
Lease payments (if applicable)
Here’s the most important part: We don’t have to guess. You track the miles, and if
you can, keep your receipts. When we sit down to do your return, we compare both
numbers. We will use whichever method puts more money back in your pocket.
One quick note: If you want to use the standard mileage rate, you generally have to
choose it in the first year you use the car for business. In later years, we can switch back
and forth. But if you start with actual expenses, you’re stuck with actual expenses for
the life of that car. So, we usually start with standard mileage to keep your options
open.
“Ralph, How Do I Actually Track This?”
Please, for the sake of your sanity and mine, don’t rely on a crumbled notebook in your
glovebox that you update “whenever you remember.” You’re busy. Let technology do
the heavy lifting.
I recommend using an app on your phone. It runs in the background, detects when
you’re driving, and you just swipe left for personal or right for business. It’s that simple.
Here are a few tools my clients have great success with:
QuickBooks Mobile App: If you’re already using QuickBooks for your accounting,
this is a no-brainer. It integrates perfectly.
MileIQ: Probably the most popular dedicated tracker. It’s incredibly reliable.
Everlance: Great if you need to track both mileage and expenses.
Stride: A solid free option that works well for freelancers and gig workers.
Regardless of the method, the IRS requires specific details. A log that just says “10,000
miles” won’t cut it in an audit. Your log needs to show:
The Date
Starting point and Destination
Business Purpose (e.g., “Meeting with Client X” or “Site visit”)
Total miles driven
Don’t Make These Mistakes
I see good people get in trouble over small things all the time. Here’s what I want you to
avoid:
Estimating. Never use nice round numbers. If your tax return says exactly “15,000
miles,” the IRS computer flags that immediately. No one drives exactly 15,000 miles.
Be precise.
Mixing trips. Dropping the kids off at school on your way to a client site? That trip to
school is personal; the leg from school to the client is business. Be honest about it.
Let’s Talk Real Numbers (The Fun Part)
Let’s look at why I’m nagging you about this. Let’s say you’re a real estate agent or a
contractor, and you drive a decent amount—say, 15,000 business miles in 2026.
The Math:
15,000 miles × $0.725 (2026 rate) = $10,875 Deduction
That is a nearly $11,000 deduction reducing your taxable income. Depending on your
tax bracket, that could save you $3,000 to $4,000 in actual cash when you pay your
taxes.
That’s enough for a nice vacation, or to reinvest in your business. But if you didn’t track
it? That money goes straight to the government.
We Can Work Through This Together
This can feel overwhelming, and that’s completely normal. But you don’t have to
navigate these rules alone. My job is to make sure you get every single deduction you
are legally entitled to, and to keep the IRS off your back.
Start tracking today. Even if you missed January, start now. A partial log is better than
no log.
If you’re unsure which app to use or how to set this up for your specific situation, just
reach out. Let’s make sure you aren’t overpaying just because of some missing
paperwork.
Make sense?
Ralph Pinney EA
Enrolled Agent & IRS Advocate
Phone: 303-881-9762
Location: Greenville, TX
Reference: IRS Notice IR-2025-128