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Milleage reimbursement
Thread poster: prozmandarin
prozmandarin
prozmandarin
United States
Jun 14

Hello,

For U.S. based in person interpreters, are you reimbursed for the mileage? My agency reimburses me, but it's lower than IRS standard $0.67/mile. Is this your case? How do I ask to raise the mileage to IRS standard?

Thank you,
 
Liviu-Lee Roth
Liviu-Lee Roth
United States
Local time: 13:19
Romanian to English
+ ...
It is irrelevant Jun 17

No matter if you get paid 10 cents/mile or $2.00/mile, at the end of the year, when you calculate your tax return, you apply the .67/mile.

Many colleagues mistankenly think that the mileage rate is an income; it is not.

Best,
Lee

IrinaN
 
prozmandarin
prozmandarin
United States
TOPIC STARTER
mileage reimbursement Jun 17

Not sure. 0.67 is used for tax deductible but the pay from the agency is 100% real $$
 
Liviu-Lee Roth
Liviu-Lee Roth
United States
Local time: 13:19
Romanian to English
+ ...
OK, let me explain Jun 18

Let's say, you drive 100 miles and are reimbursed 50 cents/mile, that means your check from the agency will include an extra $ 50.00 for driven miles. Next year, when you submit your tax return, you dededuct
$ 67 for the 100 miles driven; you deduct $17.00 more than you received.
If the agency pays you .67/mile and sends you a check including the $67.00, when you submit your tax return you report and deduct $67.00; you don't gain anything.

At the beginning of next year,... See more
Let's say, you drive 100 miles and are reimbursed 50 cents/mile, that means your check from the agency will include an extra $ 50.00 for driven miles. Next year, when you submit your tax return, you dededuct
$ 67 for the 100 miles driven; you deduct $17.00 more than you received.
If the agency pays you .67/mile and sends you a check including the $67.00, when you submit your tax return you report and deduct $67.00; you don't gain anything.

At the beginning of next year, the agency will send you a 1099-Misc with the TOTAL amount they paid to you, including compensation for your work, miles and time traveled, tolls and parking. To brake it down it is something like this (all numbers are random):
- compensation for your work ---------- $100.00
- miles traveled 100 miles x $.50/mile ---$ 50.00
- time spent travelling $ 30.00
- tolls $ 10.00
- Parking $ 5.00
TOTAL: $195.00
Of this amount, taxable amount is only $ 130 (work and travel time) while $65 (miles, tolls and parking) are not taxable and must both be SUBTRACTED and DEDUCTED.
When you subtract the miles, you will subtract $67, because this is the federal rate. Same when you deduct, you will deduct $67, not $50.
Therefore, if you get paid less for miles, it is better for you.


Does it help?
Lee

[Edited at 2024-06-19 13:54 GMT]

[Edited at 2024-06-19 14:03 GMT] ▲ Collapse
 
MollyRose
MollyRose  Identity Verified
United States
Local time: 12:19
English to Spanish
+ ...
It's called IRS deductible mileage Jun 18

See explanation here: https://finance.cornell.edu/main-dfa/news/irs-issues-standard-mileage-rates-2024#:~:text=67%20cents%20per%20mile%20driven,of%201%20cent%20from%202023.

As for whether or not your customer pays you for mileage: that needs to be negotiated before you take t... See more
See explanation here: https://finance.cornell.edu/main-dfa/news/irs-issues-standard-mileage-rates-2024#:~:text=67%20cents%20per%20mile%20driven,of%201%20cent%20from%202023.

As for whether or not your customer pays you for mileage: that needs to be negotiated before you take the assignment. Some don't pay at all, some pay the current IRS deductible amount, and others pay some other amount (either predetermined by them or as much as they choose to pay of what you request). ▲ Collapse


Liviu-Lee Roth
 
IrinaN
IrinaN
United States
Local time: 12:19
English to Russian
+ ...
You just can't deduct it twice Jun 18

prozmandarin wrote:

Not sure. 0.67 is used for tax deductible but the pay from the agency is 100% real $$


Either you deduct is yourself without invoicing the agency, or they reimburse and then, if they don't separate wages and expenses in your 1099s, then you deduct is as reimbursed expenses and it's not taxable.

Random amount is news to me - I always apply government rate to any of the two options.

For example - you submit invoice + expenses for $8000 - 4 for wages and 4 for expenses (mileage, hotel, air etc) and the agency pays a lump sum of $8000. Your CPA or TurboTax know how to separate one from another and not count it as part of your gross taxable income.

Liviu-Lee Roth
 


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