What is mileage reimbursement and how does it work?

What is mileage reimbursement and how does it work?

Mileage reimbursement is a payment to employees for using their personal vehicles for work-related travel. It typically covers fuel, wear and tear, and other expenses.

How is the reimbursement rate determined?

The reimbursement rate is often based on the IRS standard mileage rate, which is updated annually. Employers can choose to follow this rate or set their own.

Do I need to keep track of my mileage?

Yes, it's important to keep a detailed log of your mileage, including dates, destinations, and purpose of the trips, to ensure accurate reimbursement.

What if I forget to log my mileage?

If you forget to log your mileage, it may be difficult to get reimbursed for those trips. It's best to keep a consistent record to avoid issues.

Are there any tax implications for mileage reimbursement?

Generally, mileage reimbursements are not taxable if they are within the IRS guidelines. However, any excess may be considered taxable income.