The Internal Revenue Service (IRS) has issued the 2025 optional standard mileage rates (N-2025-05), raising the standard business mileage rate from 2024. Beginning January 1, 2025, the standard mileage rate for business use of a car, van, pickup truck or panel truck will be 70 cents per mile (up 3 cents from 2024).
The standard mileage rate for medical or moving purposes is 21 cents per mile (the same as 2024). The rate in service for charitable organizations remains unchanged at 14 cents per mile (the same as 2024).
The optional standard mileage rates are used to calculate the deductible amount of business, moving, medical or charitable expense (miles driven times the applicable rate). If your car is for business and personal use, you’ll want to keep adequate records and subtract out personal miles. Mileage accumulated by driving to and from your primary workplace or office is excluded from the deduction.
It is important to note that under the Tax Cuts and Jobs Act, taxpayers cannot claim a miscellaneous itemized deduction for unreimbursed employee travel expenses. Neither can taxpayers generally claim a deduction for moving expenses (For more details, see Rev. Proc. 2019-46). This would include unreimbursed mileage. Employers can reimburse employees for mileage at the standard mileage rate and are tax-free to the employee as long as accurate documentation is kept.
To help pastors with mileage and other business expenses, churches should consider an accountable reimbursement plan to reimburse their pastor(s). View the full IRS announcement here.
