The example, step by step
Meet a driver who logs 20,000 business miles in 2026: 10,000 before July 1 and 10,000 after. The car is also used privately, so the odometer shows 24,000 miles in total.
- 10,000 miles × $0.725 = $7,250
- 10,000 miles × $0.76 = $7,600
- Standard mileage deduction: $14,850
As a gig driver you are self-employed, so this goes on Schedule C. It lowers your profit, which reduces both your income tax and your self-employment tax.
Which miles count?
Rideshare apps often show only “on-trip” miles. But driving to a pickup, and driving between trips while you wait for the next request, are usually business miles too. That is why your own log is worth keeping: it often shows many more miles than the app’s summary. Driving from home before you switch the app on, or personal errands in between, don’t count.
Standard rate or actual costs?
For most drivers in efficient cars the standard rate is the clear winner. In our example the Prius costs only 7.3¢ a mile in gas at $4.153 a gallon. With $2,400 insurance, $1,500 repairs and tires, $150 registration and $4,000 depreciation, the whole car costs about $9,799 a year. 83.3% of that is business, so the actual-expense method gives about $8,166 — $6,684 less than the standard rate.
Here is the same driver (same 24,000 miles and $8,050 of fixed costs) in other popular cars:
| Car (EPA combined) | Fuel per mile | Actual-expense deduction | Standard rate gives more by |
|---|---|---|---|
| Toyota Prius 2.0L hybrid | 7.3¢ | $8,166 | $6,684 |
| Toyota Camry Hybrid | 9.0¢ | $8,514 | $6,336 |
| Toyota RAV4 hybrid | 9.7¢ | $8,640 | $6,210 |
| Honda CR-V 1.5L turbo | 13.8¢ | $9,477 | $5,373 |
| Ford F-150 2.7L | 19.8¢ | $10,664 | $4,186 |
| Tesla Model Y Long Range (123 MPGe) | 5.0¢ | $7,704 | $7,146 |
Fuel at $4.153 a gallon (EIA, week of November 2, 2026); electricity at 18.16¢ per kWh. Depreciation is kept at $4,000 for every car to make the comparison fair.
Good habits that save money
- Start a new log page on July 1 so the two rates are easy to add up.
- Keep parking and toll receipts — they are deductible on top of the mileage rate.
- Phone, car washes and the part of your phone plan used for driving are separate business expenses; the mileage rate does not cover them.
- Pick the standard rate in the first year you use the car for business. That keeps the option to switch later.
FAQ
How much can a rideshare driver deduct for 20,000 miles in 2026?
$14,850 if half the miles were driven before July 1 and half after: 10,000 × 72.5¢ = $7,250 plus 10,000 × 76¢ = $7,600.
Can I deduct gas on top of the mileage rate?
No. The standard mileage rate already covers gas, insurance, repairs and depreciation. Business parking fees and tolls can be added on top.
Is the standard rate better than actual costs for a Prius?
Usually yes. With 24,000 total miles and $8,050 of yearly costs, the actual-expense method gives about $8,166 — $6,684 less than the $14,850 standard deduction.
Sources (checked 5 November 2026): IRS news release IR-2025-128 and Notice 2026-10 (irs.gov/newsroom/irs-sets-2026-business-standard-mileage-rate-at-725-cents-per-mile-up-25-cents); IRS Announcement 2026-11 (mid-year increase effective July 1, 2026), confirmed by Journal of Accountancy and Grant Thornton (July 2026); EPA combined MPG/MPGe for model year 2026 (fueleconomy.gov data, via mpgbuddy.com); EIA weekly retail gasoline price $4.153 for November 2, 2026 (released November 3); EIA Electric Power Monthly table 5.3, U.S. residential 18.16¢/kWh for August 2026.