The mileage reimbursement calculator is a helpful tool that allows to calculate a business deduction for Federal income tax purposes. If you are using a personal vehicle for business, medical or charitable purposes, you may find it useful to find your IRS mileage reimbursement. If you are driving for any of the three purposes, business, medical, or charity, you can make some deductions from your expense account. The Federal mileage rates for each of them are announced yearly. In the next sections, you can find out more about this topic, like what is mileage reimbursement, how to find proper standard mileage rate, how much is mileage reimbursement, and how to calculate IRS mileage reimbursement on your own.
What is mileage reimbursement?
IRS mileage reimbursement is an amount per mile ($/mile) that the IRS allows businesses to reimburse their employees for trips made using a personal vehicle. This amount is unrelated to the car type. Besides the mileage reimbursement rate form, taxpayers have the option of calculating the actual costs. However, not all costs can be involved in IRS mileage reimbursement, for example, food, lodging, parking fees, tolls, minor accidents, or repairs. Standard mileage rates include fuel, oil changes, depreciation, insurance, etc.
Standard mileage rates
Rates are announced yearly by IRS, and you may find all of them on their website. Below you may find few examples of previously announced federal mileage rates for the three purposes. Based on these values, you will be able to calculate mileage reimbursement. Follow the steps in the next section to learn how to do this yourself.
How to calculate IRS mileage reimbursement?
- Define your tax year for the IRS mileage rate;
- Find your mileage reimbursement rate - you may use the data in the previous section;
- Count the miles that were driven for each purpose (business, medical, or charity);
- Multiply the miles from point 3 with IRS mileage rate from point 2; and
- Your IRS mileage reimbursement is calculated!
How much is mileage reimbursement?
In this section, you will see an example of how to use federal mileage rates in practice. Let's imagine that an employee drove 50 miles for business purposes, 30 miles for medical purposes, and 100 miles for charity purposes in 2019. Accordingly, the mileage reimbursement rates are $0.58, $0.20, and $0.14 respectively. Your reimbursement in this example would be $49. You can check the calculations below:
IRS mileage reimbursement = (50 * $0.58) + (30 * $0.20) + (100 * $0.14)
IRS mileage reimbursement = $29 + $6 + $14 = $49
Calculators related to IRS mileage rate
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