Houston Tax Attorney
I work as a merchandiser for a company and receive mileage reimbursement. The company takes taxes out of my paycheck which I get every two weeks, but not for mileage. Mileage is direct deposited weekly. Will I have to claim mileage on my taxes and how do I do so?
It depends on whether your mileage is reimbursed under an accountable or nonaccountable plan.
Accountable – An accountable plan would be one where you submit your actual mileage to the company and the company reimburses you for the mileage you actually incurred. Under an accountable plan, the employer does not include the income on your W-2 and you cannot deduct the mileage on your tax return. So it’s a wash, no action required on your part.
Nonaccountable – If the employer gives you a mileage allowance (e.g., $60 every month), then likely the employer will need to report the mileage reimbursement on your W-2. You should then be able to deduct your actual mileage expense (non-commuting only) as an employee business expense on Schedule A.
– Law Office of Kunal Patel LLC