Employers Have Options When it Comes to Mileage Reimbursement
There is no legal requirement for most employers to reimburse employees for mileage, so why do it? The answer is simple: If you choose not to reimburse, it will be difficult to attract and retain key talent in your organization. If you are currently reimbursing at the IRS rate of 51 cents per mile, this could add up to a significant expense.
Fortunately, you have other options. You could, for example:
1. offer a per-mile reimbursement at a rate less than 51 cents per mile along with a flat periodic allotment or stipend;
2. offer only a flat periodic allotment or stipend that is not based on miles driven;
3. reimburse employees for miles driven, but at a per-mile rate of your own choosing; or
4. pay the IRS recommended rate, but deduct the mileage normally traveled to and from the office every day when travelling for business.
Consider your corporate culture and the territory or area covered by your employees before making a decision that could impact morale. There are many options out there to consider that could benefit employees without bankrupting employers, and still fit in to the organization’s Total Rewards philosophy.