What is the difference between the standard mileage rate and actual vehicle expenses?

The standard mileage method multiplies your business miles by an IRS rate set each year that bundles gas, maintenance, insurance, and depreciation into one number, so you just track miles. The actual-expense method adds up real costs, fuel, repairs, insurance, registration, lease or depreciation, and deducts the business-use percentage. Actual often wins for expensive vehicles or heavy repair years, while standard wins for fuel-efficient cars and simple recordkeeping. A key rule: if you want to use standard mileage, you generally must choose it in the first year you use the car for business; you can switch to actual later but not always back. Either way, a contemporaneous mileage log is essential to survive an audit.