What’s Changed in Standard Mileage Rates
In Notice 2026-11, issued in July 2026, the IRS updated optional standard mileage rates based on rising fuel prices. Key rate changes: business travel is now deductible at 76 cents per mile, up from previous rates; medical and moving purposes are deductible at 23.5 cents per mile. This applies on and after July 1, 2026. (irs.gov)
Charitable mileage remains fixed at 14 cents per mile, per IRC §170(i). That did not change. (irs.gov)
Why It Matters for Digital Nomads
Digital nomads often incur travel and relocation costs. These could include:
- Driving between work locations or client sites.
- Moving from one residence to another for a long-term project.
- Medical travel while abroad or returning to the U.S. for care.
Using the updated rates ensures deductions match true costs. In many cases, underestimated deductions hurt your tax return.
What You Need to Do
- Track dates—the higher rates apply only to expenses paid or incurred on or after July 1, 2026. Previous mileage rates apply before that. (irs.gov)
- Maintain accurate mileage logs: date, miles, purpose (business, medical, moving).
- Evaluate method: sometimes using actual vehicle expenses (fuel, depreciation, insurance, etc.) yields more benefit than mileage rate—especially for long travel periods.
- Speak with your tax advisor about cross-border situations (e.g., using U.S. mileage rates for foreign travel—has limitations).
Example Cases
| Situation | With Old Rate | With New Rate |
|---|---|---|
| Nomad drives 1,000 business miles in June 2026 (old rate 65¢) | Deduction ≈ $650 | |
| Same 1,000 business miles in July 2026 (new rate 76¢) | Deduction ≈ $760 | |
| Medical trips: 200 miles before Jul-1 at old medical rate vs after | Substantial increase in deduction, helping offset travel costs |
For digital nomads doing frequent travel or relocating often, such differences add up—sometimes saving hundreds or thousands yearly.
Use the updated mileage rates in your 2026 returns. Make sure to track fundamentals—dates, purpose, and documentation. Always consult a qualified tax professional for items like moving expense deduction eligibility, which is tightly controlled under current law. Educational only; not tax advice.