2026 Mileage Reimbursement Rate Update

The Internal Revenue Service has announced that the 2026 mileage reimbursement rate for businesses will be 72.5 cents per mile. This is a 2.5 cents-per-mile increase over the 2025 rate of 70 cents.

If your agency allows your employees to use the IRS mileage rate, you will need to adjust your expense procedures accordingly to reflect the new mileage rate.

Information for the new rate can be found here.

If your agency uses the Commonwealth of Kentucky mileage reimbursement rate, it is important to remember that this rate is adjusted quarterly. The state mileage reimbursement rate from Jan. 1 to March 31, 2026, is 42 cents per mile. This amount is a 1-cent-per-mile decrease from the previous quarter.

As with the IRS rate, if your agency uses the state reimbursement rate, you should check your mileage reimbursement procedures to ensure that your agency is paying the correct state rate.

Information on the state rate can be found here.

If you have questions about your agency's mileage policy, please contact KLC Employment Law Attorney Michael Simon.