Can I Claim the Standard Mileage Rate or Actual Vehicle Expenses for Federal Deductions?
For the 2025 tax year, taxpayers may deduct vehicle expenses for business use, charitable services, or medical purposes. You have two options: claim the standard mileage rate or deduct actual vehicle expenses. However, you cannot claim both methods for the same vehicle in the same year.
Standard Mileage Rate for 2025
- Business Use: 70 cents per mile
- Charitable Volunteer Work: 14 cents per mile (for certain charitable organizations)
- Medical Purposes: 21 cents per mile
The standard mileage rate is a simplified method to calculate deductible vehicle expenses. It includes costs such as gas, oil, repairs, maintenance, and depreciation. The method is elected on a vehicle-by-vehicle basis, not by purpose. To use the standard mileage rate, you must generally choose it in the first year the vehicle is placed in service for business use. If you use the actual expense method in the first year, you generally cannot switch to the standard mileage rate for that vehicle in later years.
Actual Vehicle Expenses
You may choose to deduct actual expenses instead of using the standard mileage rate. These include:
- Fuel and oil
- Repairs and maintenance
- Depreciation or lease payments
- Insurance and registration fees
To claim actual expenses, you must keep detailed records, including receipts, logs, and documentation showing total miles driven and the portion attributable to business or medical use. The deduction is based on the business-use percentage of total vehicle expenses.
Important Notes
- You cannot use both methods for the same vehicle in the same year, but you may use different methods for different vehicles
- You may claim both a vehicle deduction and a home office deduction if otherwise eligible; they are separate deductions.
- If you claim accelerated depreciation methods (such as Section 179 or bonus depreciation) or certain lease treatments, you may be restricted from using the standard mileage rate for that vehicle in future years.
- For charitable volunteer work, only mileage for services provided to qualified organizations is deductible, and the rate is set by law and does not change annually with inflation.
- Maintain adequate records to substantiate all mileage and expenses, including dates, mileage, business purpose, and total use.
Source:
Publication 17
Publication 946
Disclaimer: Always verify details with official Federal or State Department of Revenue Forms and Instructions.