When it comes to tax deductions for vehicle-related expenses, business driving often comes to mind. But, individuals can also deduct driving expenses in certain situations. Unfortunately, under current law, you may not be able to deduct as much as you could in previous years.
How the TCJA changed deductions
Before 2018, you could deduct miles driven for business, moving, medical, and charitable purposes. However, from 2018 through 2025, business and moving miles are deductible only in more limited situations, thanks to the Tax Cuts and Jobs Act (TCJA), which may also impact your deductions for medical and charitable miles.
Previously, employees could deduct business mileage that their employer did not reimburse as miscellaneous itemized deductions. This was subject to a 2% of adjusted gross income (AGI) floor, meaning you could only deduct mileage if your total miscellaneous itemized deductions exceeded 2% of your AGI. However, under the TCJA this deduction was suspended for 2018 to 2025, regardless of AGI.
If you’re self-employed, you can still deduct business mileage from self-employment income, without being subject to the 2% floor. As long as the mileage qualifies, it’s deductible through 2025.
Medical and moving miles
Before 2018, miles driven for a work-related move were generally deductible without itemizing. But, for 2018 through 2025, only active-duty military members can deduct moving expenses.
If you itemize, you can still include travel expenses for medical miles—those driven for healthcare-related purposes—as part of the medical expense deduction. For instance, you can deduct mileage for trips to doctors’ appointments. In 2024, medical expenses are deductible to the extent that they exceed 7.5% of your AGI.
Charitable mileage deductions are set by law and don’t adjust for inflation. However, they can only be claimed if you itemize. With the standard deduction nearly doubling from 2018 to 2025, fewer taxpayers are itemizing. Depending on your total deductions, you may be better off taking the standard deduction, meaning no tax benefit from your charitable or medical miles—even if you exceed the AGI threshold.
Rates depend on the trip
You can skip tracking of your actual vehicle expenses and instead opt to use the standard mileage rate, which varies by purpose. For 2024, these standard rates are:
- Business: 67 cents per mile
- Medical: 21 cents per mile
- Moving for active-duty military: 21 cents per mile
- Charitable: 14 cents per mile
On top of the standard mileage rate, you can also deduct related parking fees and tolls. Be sure to track your miles driven for substantiation purposes.
Smolin is here to help
Have questions about deducting vehicle-related expenses? We’re here to help. Reach out to your Smolin advisor for tax tips to maximize your deductions and get the most out of your vehicle expenses.