Check Your Mileage Reimbursement Rates

Every year the IRS sets the business standard mileage rate. For 2021, the standard mileage rate has decreased to 56 cents a mile.

As of January 1st, 2021, the standard mileage reimbursement rates are:

• 56 cents per business mile, down 1.5 cents from 2020
• 16 cents per mile for medical or moving purposes, down 1 cent from 2020
• 14 cents per mile for charity purposes,

We recommend that you verify your company's mileage reimbursement rate is set correctly in ClickTime.

In order to edit your company's mileage rate, follow these steps:

1. Sign in to ClickTime (you need to be an administrator).
2. Click the Expenses link on the menu bar under the Company tab.
3. Click the Expense Types link.
4. Click on the name or edit pencil icon of your mileage expense type.
5. Edit the rate value. For example, enter 0.575 for the new federal rate.
6. Choose whether to apply the rate change to existing expenses that haven't been approved.
7. Save your changes.

If your company has multiple mileage expense types, remember to repeat steps 4-7 above for each appropriate expense type.

How Does the IRS Calculate Mileage Reimbursement Rates?

The IRS calculates the mileage reimbursement rate using a number of factors, but they do not explicitly state all of the variables that go into selecting the rate. That being said, here is what we know. The 2021 mileage reimbursement rate is determined by the cost of gasoline (which can vary significantly year over year), the cost of maintaining a car, and average wear and tear on a vehicle.