The Internal Revenue Service (IRS) unveiled the 2025 business mileage standard rate of 70 cents, up from 67 cents in 2024. The rate, according to an announcement, was based on data from Motus, a provider of vehicle reimbursement and driver risk mitigation solutions. Motus, according to an announcement, has supported the IRS mileage rate since 1981.

Driving costs have changed in 2024 due to some key factors and trends, according to the announcement, including:

• Increased cost to buy a car: Vehicle acquisition costs continue to rise, and there is increasing depreciation.
• Increased cost to own a car: Auto insurance, maintenance and repair costs all increased year over year.
• Decreases in fuel prices: Although fuel prices have fluctuated throughout the year, overall fuel prices in 2024 have been lower than in 2023.

The IRS business mileage standard cents-per-mile (CPM) rate provides a tax-free threshold for reimbursements that US employers can offer to employees, in addition to individual tax deductions.

Phong Nguyen, CEO of Motus, said, “It’s essential for business leaders to support their employees who drive as a part of their job — and rely on their vehicles for work — by implementing fair and accurate reimbursement strategies while also optimizing reimbursement spend and mitigating waste and risk.”

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