If someone has used their personal vehicle for business, medical, or charitable purposes this year, they may be eligible to deduct those miles using the IRS mileage rate. Understanding how this deduction works on 2025 tax returns can be beneficial for self-employed individuals, gig economy workers, or those who drove to doctor appointments or volunteer events. This guide outlines how this deduction typically works and what documentation is often required.

What Is the IRS Mileage Rate for 2025?

Each year, the IRS sets a standard mileage rate for different types of deductible driving. For 2025, the rates are:

These rates generally apply depending on the purpose of driving:

• Business miles: 67 cents per mile

• Medical and moving miles: 22 cents per mile

• Charitable miles: 14 cents per mile (fixed by law)

Understanding which rate applies is essential, since the IRS usually requires separating the purpose of each drive.

Understanding Eligibility

Before considering any mileage deduction, it’s important to understand which situations tend to qualify under IRS guidelines.

The following individuals often can claim mileage:

• Self-employed workers and freelancers — Business-related driving may be deductible

• Active-duty military — May qualify for moving expenses under certain conditions

• Volunteers — Miles driven for qualified nonprofits could count

Most W-2 employees are typically not eligible to claim mileage deductions due to the Tax Cuts and Jobs Act (TCJA), unless they meet specific exemptions.

The Importance of Accurate Mileage Tracking

The mileage rate typically cannot be claimed without proper records. The IRS generally requires a complete mileage log showing details of each trip.

A proper log generally includes the following for each trip:

• Date — Verifies that the trip occurred during the 2025 tax year

• Start and end locations — Helps prove legitimacy and distance

• Business or service purpose — Indicates why the trip might qualify

• Total miles driven — Core data used for calculating potential deductions

Digital tools like Everlance, MileIQ, or QuickBooks Self-Employed can assist in automating tracking and generating IRS-compliant reports.

Categorizing Miles by Purpose

Total mileage generally needs to be separated by category because each has a different deduction rate.

Yearly mileage is typically broken down like this:

• Business miles — These are often separated for Schedule C (self-employed)

• Medical or moving miles — If applicable, these might be recorded for itemized deductions

• Charitable miles — Usually only applicable when volunteering for a registered 501(c)(3)

Precision is important, as rounding numbers or estimating without support could potentially trigger audits.

Understanding the Correct IRS Tax Forms

The form used depends on filing status and deduction type. Here’s a general breakdown:

Common forms based on status and type of mileage:

• Schedule C (Form 1040): Generally used by self-employed individuals to claim business miles

• Form 2106: Limited to certain W-2 employees (e.g., armed forces reservists)

• Schedule A (Form 1040): Typically used for itemizing medical or charitable mileage

Business mileage deductions are generally handled on Schedule C, while medical and charitable deductions are most beneficial if itemized.

How the Calculation Usually Works

To calculate potential deductions:

• Multiply the number of miles driven in each category by the corresponding rate

• Add any additional allowable expenses, such as tolls or parking fees

Here’s a simple example of how this might work:

• 8,000 business miles × $0.67 = $5,360 potential deduction

• 300 medical miles × $0.22 = $66 potential deduction

• 500 charitable miles × $0.14 = $70 potential deduction

Tax software like TurboTax or H&R Block can assist in simplifying these calculations and ensuring accurate reporting.

The Importance of Documentation

The IRS doesn’t generally require submitting mileage logs when filing, but having them available in case of an audit is often recommended.

Here’s how many taxpayers protect themselves:

• Save digital and physical copies of mileage logs and receipts

• Use IRS-compliant apps to generate downloadable reports

• Keep backup documentation like appointment confirmations or volunteer event details

Good documentation can help provide peace of mind at tax time.

Strategies to Maximize Potential Deductions

For those looking to optimize their mileage claims, these strategies are often helpful:

A few extra habits that might boost deduction potential:

• Log mileage daily — It’s typically easier than reconstructing it months later

• Track tolls and parking fees — These can often be added separately to deductions

• Use calendar records — Cross-reference meetings or volunteer events to validate logs

• Track multiple vehicles separately — Use apps that allow multi-vehicle tracking

These details often make the difference between a good deduction and a great one.

Final Thoughts

Understanding the IRS mileage rate for 2025 tax returns can be valuable for reducing taxable income. With the business rate set at 67 cents per mile, even modest driving could result in significant savings.

Keeping good records, using the appropriate forms, and understanding mileage categories like medical and charitable (if itemizing) are important factors to consider. With the right tools and organization, taxpayers might be able to make the most of every mile they drove this year.

Disclaimer: This article is for informational purposes only and should not be construed as professional tax advice. Tax laws and regulations are complex and subject to change. The information provided is general in nature and may not apply to every individual’s specific situation. For personalized advice or guidance regarding your tax return, including claiming mileage deductions, please consult with a qualified tax professional or contact the IRS directly.