Standard mileage rate vs. actual expenses
You have two options:
Standard mileage rate (2025): 70 cents per mile. Multiply your business miles by this rate. Simple, no receipts needed beyond a mileage log.
Actual expenses: Track gas, insurance, repairs, depreciation, parking, and tolls. Then multiply total costs by the percentage of miles driven for business. More work, but sometimes a bigger deduction if you drive an expensive vehicle.
You must choose one method for each vehicle. If you want to use the standard rate, you need to choose it in the first year you use the vehicle for business.
You drove 12,000 miles for business in 2025.
Standard method: 12,000 × $0.70 = $8,400 deduction
Actual method: Total car expenses were $9,600. Business use was 60% of total miles. 60% × $9,600 = $5,760 deduction
In this case, the standard method wins.
What counts as business mileage?
- Driving from your office to a client meeting
- Trips to the bank, post office, or supply store for business
- Travel between two work locations
- Driving to a temporary work site
What doesn't count: Your daily commute from home to your regular workplace. That's personal mileage. However, if your home IS your principal place of business (home office), then trips from home to any business destination are deductible.
See IRS Publication 463, Chapter 4. Standard mileage rates are updated annually in an IRS Revenue Procedure. Report on Schedule C, Line 9 (car and truck expenses).
Log your business miles in Hivebooks
Connect your bank account and Hivebooks auto-categorizes gas station charges. Track your mileage deduction alongside all your other business expenses in one place.
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