Payroll

What Does Mileage Reimbursement Cover?

Some jobs require your employees to use their personal cars for work purposes. For example, maybe you manage a tutoring company and your tutors are required to drive to people’s homes. You want to make sure you’re staying compliant when paying your team for their work, even with something like gas money.

Although there is no federal requirement, many employers reimburse their employees for miles driven for work using the standard IRS rate. For 2018, that’s $0.545 (or 54.5 cents) per mile.

There’s a good reason for this. In some states, such as California, it’s required that you reimburse your employees for business travel expenses. So make sure to check out the rules in your state to stay compliant.

 

This article provides general information and shouldn’t be construed as tax advice. Since tax rules may change over time and can vary by location and industry, please consult a CPA or tax advisor for advice specific to your business.