Mileage Reimbursement

barchinal · April 2002

Is it neccessary to reimburse at the Federal allowable of .365 per mile? Or can I pay whatever I want? I currently pay mileage for caregivers who travel outside city limits.

Magestry · April 2002

This is a questions that I have asked for about two years. I would also love to hear the answers. When I reasearched it what I found is that the company is not mandated to pay for milage. Milage is governed by the IRS and they can use it as a deduction as a business expense when they filed their income tax at the end of the year. The reason why many company's has opted to pay milage is more for a perception point of view. The employee feels like they are being compensaged for the use of their vehicle.

System · April 2002

I'm fuzzy on anything dealing with the IRS, but here's what I think. I believe that the federal amount is simply the maximum that you can deduct as a business expense for tax purposes. I think you can pay less, or nothing at all, unless there's a law I don't know about. Although the ill will you create might not be worth it. You could pay more, but I don't know what the tax implications would be for your company and the employee.

James Sokolowski
Senior Editor
M. Lee Smith Publishers

trc454 · June 2002

If you reimburse up to the IRS leve it does not have to be reported or taxed.

Mileage Reimbursement

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