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mileage · deductions · vehicle · field-tech · 2026

Standard Mileage vs. Actual Expenses for a Service Van in 2026

· 5 min read · TechLedger · Reviewed by Al

If you run service calls out of a van, your vehicle is probably your single biggest deduction. The IRS lets you write it off one of two ways: the standard mileage rate or your actual expenses. You can’t stack them, and the choice you make in your vehicle’s first business year can quietly lock you in for its whole life. Here’s how to think it through for 2026.

The two methods, in plain English

Standard mileage is a flat per-mile rate that’s meant to cover gas, oil, repairs, insurance, and depreciation all at once. You track business miles, multiply by the rate, and that’s your deduction. Simple.

Actual expenses means you total up what the vehicle actually cost you — fuel, insurance, repairs, tires, registration, lease payments or depreciation — and deduct the business-use percentage of that total.

Whichever method you pick, you can also separately deduct business-related parking and tolls on top.

2026 has a mid-year mileage rate — don’t average it wrong

This is the part that trips people up in 2026. The standard business mileage rate is not a single number for the year. Per IRS Announcement 2026-11, it’s a mid-year split:

  • 72.5 cents per mile for miles driven January 1 – June 30, 2026
  • 76 cents per mile for miles driven July 1 – December 31, 2026

So you have to break your mileage log into two buckets and apply each rate to the miles actually driven in that half of the year. You can’t take your full-year total and multiply by one blended rate. (For 2025, by contrast, the rate was a flat 70 cents per mile all year.) We covered the increase in more detail in the mid-year mileage rate change.

The first-year election rule (the big one)

Here’s the rule that makes this decision matter long-term:

  • If you want the option to switch between methods later, you generally have to use the standard mileage rate in the first year you place the vehicle in business service.
  • If you use actual expenses in year one, you’re generally stuck with actual expenses for that vehicle for as long as you use it for business.

The reason is depreciation. The standard mileage rate already bakes in a depreciation component, and once you claim actual-expense depreciation (especially accelerated methods like bonus depreciation or Section 179) on a vehicle, the IRS won’t let you flip back to the mileage rate for it.

Translation: if you’re not sure which will be better over the vehicle’s life, choosing standard mileage in year one keeps your options open. A leased vehicle has its own wrinkle — if you use the standard mileage rate for a leased vehicle, you generally must keep using it for the entire lease term.

Which one actually deducts more?

There’s no universal answer — it depends on your vehicle and how you drive it. A few honest rules of thumb:

Actual expenses tends to win when:

  • Your vehicle is expensive to own and operate — a big cargo van, poor fuel economy, high insurance, frequent repairs.
  • You drive a lot of business miles but the cost per mile is high.
  • You bought the van recently and can claim meaningful depreciation.

Standard mileage tends to win when:

  • You drive a high number of business miles in a relatively cheap, fuel-efficient, reliable vehicle.
  • You want dead-simple recordkeeping.
  • The paid-off vehicle has little depreciation left to claim.

The only way to know for your situation is to run both. Total your actual costs for the year, apply your business-use percentage, and compare that to your two-bucket mileage calculation.

Recordkeeping either way

Both methods require you to substantiate business miles — the IRS expects a contemporaneous log with the date, destination, business purpose, and miles for each trip. A mileage app or even a notebook in the glovebox works, as long as it’s kept up as you go rather than reconstructed in April.

For actual expenses, keep every receipt: fuel, oil changes, tires, repairs, insurance premiums, registration, and lease or purchase records. You still need total miles and business miles to compute your business-use percentage.

Your business-use percentage matters for both methods, because commuting from home to a regular workplace is generally personal, not business. If you’re a mobile tech working off a home base, see home office for mobile techs for how a qualifying home office can change which trips count as business miles.

Where this fits in your overall tax picture

Your vehicle deduction reduces your net Schedule C profit, which in turn lowers both your federal income tax and your self-employment tax — so getting this right has a double effect. It also feeds the QBI deduction and affects what you should be setting aside for quarterly estimated taxes.

If your income comes through the platforms, remember they report differently: Field Nation issues a 1099-K (gross, including its 10% fee), while WorkMarket issues a 1099-NEC. Your vehicle deduction is claimed on Schedule C regardless of how the income was reported.

The bottom line

  • The standard mileage rate for 2026 is 72.5 cents/mile for Jan–Jun and 76 cents/mile for Jul–Dec — apply each rate to the miles driven in that half.
  • Using standard mileage in the vehicle’s first business year generally preserves your ability to switch methods later; using actual expenses first generally locks you into actual expenses.
  • There’s no universal winner — run both and compare, and keep a real mileage log either way.

Want to see how your vehicle deduction changes your bottom line? TechLedger is a free, browser-based estimator for 1099 field techs that models your federal profit, self-employment tax, and estimated reserves using the standard mileage method — no account, and your numbers stay in your browser. It gives you planning estimates, not tax advice, and it doesn’t replace a tax professional for your final return.