Is Mileage Reimbursement Subject To Taxes?

Question

I had a company offer me a contract position. It requires a lot of travel and they will pay me 0.75 cents per mile. I currently get mileage reimbursement from my company that doesnt have taxes taken out of it, however I am not contract there. So I am not sure.

Answer 1

I know at my job that they pay for my mileage but the money is taxed so, I dont know it could be different in every company.

Answer 2

It should not be taxable as you are in fact loaning the company money to cover a business expense.  By the way, 75 cents a mile stinks.

Answer 3

depend where they put it on your W-2  if it is included in wage it is taxable but if they put in in box I Think 14 and it said that it is not taxable.. then you have to subtract that amount from your work related expenses that you Can deduct on your tax.. I hope you understand what I'm saying... because I think I even confused my self ha ha ha

Answer 4

Problem #1, the federal amount is 58.5 cents a mile starting 7/1.  Any amount above that *is* taxable.

Problem #2, the company is probaly *not* on an accountable plan, so they will put the full 75 cents a mile onto your W-2 and let you deduct the amount you can on your tax return.  You can decuct $0 (if you keep no records), 58.5 cents a mile (with records ) or actual costs (even more records).  You will an amount equal to 2% of your agi and only get to deduct the mileage if you can itemize.

Answer 5

Since they are paying you more than the amount the IRS allows of 58.5 cents per mile as of July 1, the difference is taxable.

Answer 6

from what I hear as long as you keep every single receipt you can claim all your gas when doing your taxes

Answer 7

no

Answer 8

yes it can. My sister when she worked for a Home health company was paid not only a salary but mileage. At tax time it was considered a form of wage and you have to claim it especially if the company turns it in as your wages though doesnt take taxes out. The only difference on no contract is that you have no trace of employement, so when you reach the ripe age of retirement age your point wont add up to 40 quarters. Either way, if its found out that you stiffed uncle Sam.... he's gonna wants his money. MY suggestions is to make a savings account and put atleast 20% of what you make into it so in the event it comes back and bite you ... you have it for taxes.

Answer 9

To the extent your reimbursement exceeds the greater of your actual costs or the IRS standard mileage rate, it is taxable as ordinary income. Below that it is just reimbursement for your costs.

Answer 10

NO!

Answer 11

No clue, do you think if I am self employed gas is a right off? I bet lots of people are going to try to claim it next year!

Answer 12

Anything above the IRS standard mileage rates is taxable.  The standard rates are 50.5 cents a mile, going up to 58.5 cents a mile on July 1st.

Edit: vb did a better job describing the issues than I did

Answer 13

No.  It's a washout.

If they claimed it as income, then you could deduct the mileage from your taxable income.

You cannot, however, claim any deduction as it is reimbursed.

The company claims it as an expense on their books.

Answer 14

It's free in my state and for Federal taxes.  Or at least the legal rate of 46c per mile