Rental Property Mileage Deduction: Rules for Landlords in the US & Canada (2026)

Owning rental real estate involves far more driving than most new landlords expect. Between showing vacant units, meeting plumbers and electricians, picking up supplies at Home Depot, conducting move-in and move-out inspections, and checking on properties after storms, those trips quickly add up to thousands of miles or kilometres a year.

Fortunately, both the IRS and the CRA allow landlords to claim a rental property mileage deduction to offset their rental income — provided you understand which trips qualify as current deductions, which trips must be capitalized, and how to document your drives properly.

This guide breaks down the 2026 rental property mileage deduction rules for landlords in both the United States (IRS Schedule E) and Canada (CRA Form T776).

US Landlords: How the Rental Property Mileage Deduction Works (IRS Schedule E)

In the United States, IRS Publication 527 (Residential Rental Property) allows rental property owners to deduct the ordinary and necessary expenses of managing, conserving, and maintaining their rental property from the time the property is made available for rent.

1. The 2026 IRS Mileage Rate for Landlords

For the 2026 tax year, landlords can calculate their rental property mileage deduction using either:

• The 2026 Standard Mileage Rate: 72.5 cents per mile (January–June) or 76 cents per mile (July–December) for every qualifying rental business mile driven (plus 100% of rental-related parking fees and highway tolls), or
• The Actual Expense Method: Your rental-use percentage of actual gas, oil, insurance, repairs, registration, lease payments, and depreciation.

For most landlords who use a personal car or SUV for both personal life and managing rentals, the standard mileage rate is much simpler and often produces a larger deduction.

2. Where to Claim Rental Mileage on Your US Tax Return

You report your rental property mileage deduction on Schedule E (Form 1040), Part I, Line 6 ("Auto and travel") in the column corresponding to the specific rental property you visited. If a single trip served multiple properties (for example, picking up smoke detectors for three different duplexes), you can allocate the mileage reasonably across those properties.

Critical IRS Rule: Maintenance & Management vs. Capital Improvements

The #1 trap in IRS rental property audits is the line between routine maintenance/management (immediately deductible on Schedule E) and capital improvements (which must be added to the property's cost basis and depreciated over 27.5 years).

Deductible Immediately on Schedule E (Line 6)

You can deduct 100% of your mileage in the current tax year when the primary purpose of the trip is to manage, conserve, or maintain an existing rental property that is already placed in service:

• Showing a vacant unit to prospective tenants
• Meeting tenants to sign leases, hand over keys, or resolve complaints
• Performing routine repairs and maintenance (fixing a leaky toilet, patching drywall, mowing the lawn, replacing a broken lock, painting between tenants)
• Supervising contractors or handymen performing routine repairs
• Hardware store runs to buy maintenance supplies (filters, lightbulbs, cleaning supplies, replacement parts)
• Routine property inspections (seasonal walk-throughs, move-in/move-out inspections)
• Driving to the bank, CPA, or attorney for matters related to an existing rental property

Must Be Capitalized (Not Deductible on Line 6)

Under IRS rules, travel expenses incurred to acquire a property or to make a capital improvement (a betterment, restoration, or adaptation that materially adds value or prolongs the property's life) are not currently deductible on Line 6. Instead, they are added to the cost basis of the property or improvement and depreciated:

• Driving to inspect and close on a property before you purchase it
• Driving to a newly purchased fixer-upper to gut-renovate the kitchen and bathrooms before the property is placed in service (held out as available for rent)
• Driving to supervise a major capital project (such as adding a deck, replacing the entire roof, or finishing a basement)

Pro Tip for Landlords: Once your rental property is officially placed in service (advertised and ready for tenants), mileage driven for ongoing management, tenant showings, and ordinary maintenance is immediately deductible on Schedule E. Always note the specific repair or management task in your IRS mileage log so an auditor can clearly see the trip was for maintenance rather than a capital remodel!

Local vs. Out-of-Town Rental Property Mileage

• Local Rental Properties: IRS Publication 527 says travel between your home and a rental property is generally nondeductible commuting, unless your home is your principal place of business for the rental activity (see Publication 587 for the home office test). If your home office qualifies, driving from home to your rental properties and supply stores is deductible. Either way, driving from one rental property to another, or from a property to a hardware store and back, is deductible travel between work locations.
• Out-of-Town / Out-of-State Rentals: Driving (or driving to the airport) to inspect, repair, or manage an out-of-town rental property is deductible on Schedule E, provided the primary purpose of the trip is managing or maintaining the rental property rather than taking a personal vacation.

Canadian Landlords: CRA Rental Property Mileage Rules (Form T776)

In Canada, the Canada Revenue Agency (CRA) has very specific rules on Form T776 (Statement of Real Estate Rentals) regarding when landlords can deduct motor vehicle expenses. The CRA divides landlords into two categories based on how many rental properties you own:

Category 1: You Own ONE Rental Property

If you own only one rental property, the CRA allows you to deduct reasonable motor vehicle expenses only if ALL three of the following conditions are met:

1. You receive income from only one rental property, and it is located in the general area where you live.
2. You personally do part, or all, of the necessary repairs and maintenance on the property (so your vehicle is used to transport tools and materials to the rental property).
3. You have motor vehicle expenses to transport tools and materials to the rental property.

What you CANNOT deduct with only 1 rental property in Canada:

• You cannot deduct motor vehicle expenses incurred solely to collect rents (the CRA considers collecting rent from a single property to be a personal expense).
• You cannot deduct long-distance travel expenses (or vehicle expenses outside your general living area) for a single rental property.

Category 2: You Own TWO OR MORE Rental Properties

If you own two or more rental properties (located on at least two different sites away from your principal residence), the CRA expands what you can deduct! In addition to transporting tools and materials for repairs, you can deduct reasonable motor vehicle expenses incurred to:

• Collect rents
• Supervise repairs performed by contractors
• Manage the properties (inspections, tenant meetings, showing units)

(Note: With two or more properties, this applies whether your rental properties are located in or outside the general area where you live, as long as they are on at least two different sites away from your principal residence. The expenses must be reasonable for your situation, and you must prorate your actual vehicle expenses using a CRA mileage log book.)

Side-by-Side Comparison: US (Schedule E) vs. Canada (Form T776)

* US trips that start from home are deductible only if your home is your principal place of business for the rental activity. Otherwise, the IRS generally treats home-to-rental driving as commuting.

Sample Landlord Mileage Log Entries

When logging your rental property mileage deduction, write descriptions that clearly show the property address and the maintenance or management task performed:

Entries this specific are much easier to write on the spot than months later. In automileage.app, you record the property address and the task as you leave each site and attach the hardware store receipt with a photo, so repair trips and capital-improvement trips stay clearly separated when it's time to file.

Track and Export Your Landlord Mileage with automileage.app

Whether you manage one duplex or a portfolio of ten single-family rentals, keeping a clean mileage log is the easiest way to protect your rental property mileage deduction from an IRS or CRA challenge:

• Log Property Trips in Seconds: Record the date, property address, repair/management purpose, and exact distance right from your phone.
• Attach Hardware & Vehicle Receipts: Snap photos of receipts alongside your vehicle log.
• Export PDF & CSV Reports: At tax time, export your mileage log in PDF and CSV formats so you or your CPA can plug the exact figures into Schedule E or Form T776.

Get started risk-free and never miss another deductible trip to your rental properties.

Frequently Asked Questions

Can landlords claim a rental property mileage deduction?

Yes. In the United States, landlords can deduct mileage driven for ordinary and necessary rental property management, maintenance, and tenant visits on IRS Schedule E (Line 6) at 72.5 cents per mile through June 30, 2026 and 76 cents per mile from July 1. Trips that start from home generally qualify only if your home is your principal place of business for the rental activity. In Canada, landlords can deduct motor vehicle expenses on CRA Form T776 if they meet the CRA criteria for one vs. multiple rental properties.

What is the 2026 IRS mileage rate for rental property?

The 2026 IRS standard mileage rate for deductible rental property driving is 72.5 cents per mile through June 30 and 76 cents per mile from July 1, the same rates used for standard business travel.

What is the difference between repair mileage and capital improvement mileage?

Under IRS Publication 527, driving to a rental property to perform routine repairs, maintenance, inspections, or tenant showings is currently deductible on Schedule E in the year incurred. However, driving to a property primarily to construct, renovate, or make capital improvements that add to the property's basis must be capitalized and depreciated along with the improvement cost.

Can I deduct mileage to look for a new rental property to buy?

If you are investigating your very first rental property in a new geographic area, travel expenses before you acquire the property are generally treated as start-up or capital acquisition costs rather than immediate Schedule E deductions. If you buy the property, travel directly tied to acquiring it is added to your cost basis.

What are the CRA rules for rental property mileage in Canada (1 property vs. 2+ properties)?

The CRA distinguishes between owning one rental property versus two or more. If you own one rental property, you can deduct reasonable motor vehicle expenses only if you personally do part or all of the necessary repairs and maintenance (to haul tools and materials) and the property is in your general living area. If you own two or more rental properties, you can also deduct mileage to collect rents, supervise repairs, and manage the properties.

How do I document my rental property mileage deduction for an audit?

You must keep a contemporaneous mileage log recording the date, starting location, rental property address or store visited, specific purpose (such as 'fix leaking kitchen faucet at Unit 2B' or 'show vacant apartment to prospective tenant'), and exact miles or kilometres driven, plus annual odometer readings.