Should a company's mileage reimbursement rate be the same as the IRS business deduction rate or the other IRS rates?

Now that the IRS has raised it's standard mileage rates for personal vehicle use I wonder how these rates relate to the reimbursement rates paid by a private company. Should a company reimburse employees for infrequent trips at the IRS business deduction rate or at some other rate? I'm also unclear on the differences between the IRS rates for business use, medical and moving expenses, and charitable use.

Why are these different? Why is the business rate almost twice the moving rate and 4 times the charitable rate? Can someone explain the background for the differnet IRS rates and how to set a business rate in a simple understandable way?

Asked by gfc62 40 months ago Similar questions: company's mileage reimbursement rate IRS business deduction rates Business > Financial Planning.

Similar questions: company's mileage reimbursement rate IRS business deduction rates.

Not necessarily A company can decide to reimburse you or not for mileage on your personal vehicle. The IRS rate is the maximum non-taxable rate allowed. Some companies adjust right away, most don't -- when the IRS changes the maximum allowable mileage deduction.

The good news is (maybe) that you can still deduct the difference on your taxes. KEEP GOOD RECORDS! The reason I say maybe is because you first have to get over the minimum deduction in that category in order to deduct any of those expenses.

If your company reimburses you $.30 and the IRS rate is . $52, then you can deduct the $.22 difference in your personal taxes as a business mileage expense. As far as moving and charitable use, they have separate rates because there are also other deductions associated with them.

You can deduct the mileage and you can also deduct food expenses, for instance, with moving deductions. That's why the mileage rates are different, but it doesn't make it any less confusing. Hope that helps a little.Cheers..

Poppet! Said: 1 The city I lived in just raised their mileage rate, but it's still lower than the IRS rate. No one really knows why, I guess just because they can.

Most of the employees don't put in for it anyway.

The city I lived in just raised their mileage rate, but it's still lower than the IRS rate. No one really knows why, I guess just because they can. Most of the employees don't put in for it anyway.

3 I'm not so concerned about whether I can deduct my mileage expenses. My question is more about how a business should decide what a fair reimbursement rate is for employees doing occasional travel (2 to 4 50 mile trips per month)I thought if I better understood the background behind the IRS rate it would help me understand why a company might choose to pay a different amount. As I understand it, the IRS rate was set up to simplify calculation of all vehicle costs including depreciation, insurance, etc.And was intended for people using their personal vehicles for a high percentage of business miles.

Is it necessary to include these fixed costs when reimbursing employees for ocasional travel? .

I'm not so concerned about whether I can deduct my mileage expenses. My question is more about how a business should decide what a fair reimbursement rate is for employees doing occasional travel (2 to 4 50 mile trips per month)I thought if I better understood the background behind the IRS rate it would help me understand why a company might choose to pay a different amount. As I understand it, the IRS rate was set up to simplify calculation of all vehicle costs including depreciation, insurance, etc.And was intended for people using their personal vehicles for a high percentage of business miles.

Is it necessary to include these fixed costs when reimbursing employees for ocasional travel?

4 Most private companies reimburse better than the government does. This user has been banned from Askville.

4 Most private companies reimburse better than the government does.

Most private companies reimburse better than the government does.

The 2015 federal mileage rate is 57.5 cents per mile for business, 23 cents per mile for medical and moving, and 14 cents per mile for service to charitable organizations. These rates apply nationwide.

It is the same as it is in every rate.. CA is not special.

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