IRS Mileage Commuting Rule: What Businesses Need To Know

Dimitri Gedevanishvili

Dimitri Gedevanishvili

Marketing Manager
irs commuting from home to work rules

A common question many workers and business owners have is whether their commute to their place of work is tax-deductable or reimbursable. As a general rule, the IRS doesn’t allow trips from your house to your place of work to be deductible. In addition, businesses typically don’t reimburse their employees for their commute from home to the office or vice versa.

For the majority of businesses and drivers, that’s just about all you need to know. With that said, there are certain minor exceptions and instances that go against that grain. Today, we’re going to discuss what the IRS considers a commute, what those aforementioned exceptions can be, and how TripLog can help companies manage their mobile team members’ commutes.

Defining the IRS Mileage Commuting Rule

The IRS defines commuting as “the cost of transportation between your home and your main or regular place of work” and states that these expenses cannot be deducted from your taxes. Such a trip would be defined as a personal trip, and personal trips are not eligible for deductions under the IRS’ rules, and businesses generally do not reimburse personal trips (although they could if they chose to).

Should Businesses Provide Mileage Reimbursement For Commutes?

Generally speaking, there is no federal mandate requiring businesses to reimburse their employees for anything related to the business or personal uses of their vehicles. Outside of a few specific states, businesses usually offer company mileage and expense reimbursement as a perk to help hire and retain strong candidates.

Related: IRS Mileage Rate Explained | How Is The Standard Mileage Rate Determined?

Even with businesses that choose to offer a mileage reimbursement plan, most will not offer any sort of reimbursement for personal trips, commute to and from their place of work included. This is a standard practice and will generally not have any effect on businesses’ abilities to hire or retain quality employees.

With TripLog, it’s never been easier to set custom daily commute mileage exemption rules. In the TripLog administrator dashboard, business owners and managers are able to deduct certain portions of their mobile team member’s trips from their mileage reports.

TripLog Unique Feature: Commute Mileage Exemption

One of TripLog’s many unique features that sets it apart from other mileage and expense trackers is our commute mileage exemption feature. Companies on the TripLog enterprise plan are able to set rules exempting certain trips from their employees’ mileage logs.

Companies are able to exempt the following trips from their employees’ mileage logs:

  • The total trip mileage of the day
  • Both the first and last trip of the day
  • Only the first trip of the day
  • Only the last trip of the day

For example, if they were to choose the “Both the first and last trip of the day” option, then their employees that use TripLog would have their first and last trips (i.e. their commute to and from their place of work) exempt from the companies’ mileage reports. This is just one of many unique features and capabilities that set TripLog apart from other mileage and expense trackers.

businesses filing taxes using triplog

IRS Mileage Commuting Rule Edge Cases 

As stated above, there are certain specific instances where you can deduct your “commute”, which include the following:

  • If you’re traveling between your residence and a temporary work location or job that you expect to work at for less than a year
  • If you’re traveling from one job to a secondary or temporary job or job site 
    • Keep in mind that your commute from home and your second job on, for example, a day off from your main job is not deductible
  • If you’re traveling between a temporary work location and your secondary job
  • If you are traveling from your tax-deductible home office to your main job

Home Office Rules

If you have established a home office, you are able to deduct certain trips from your taxes, assuming you are driving from your home office to another established place of work. For example, if you are a carpenter and have a workshop or studio downtown but you do all of your administrative work at your qualifying home office, you are able to deduct the trip from your home office to your workshop.

Related: How Employees Working From Home Deduct Their Mileage

Keep in mind, the IRS has very specific rules and regulations regarding what is or isn’t a home office, so be sure to review these requirements and keep them in mind when you do your taxes.

  • If you are required for work to travel to another location, which isn’t your regular workplace or home.
  • If you travel between your home and a temporary job, which you expect to work at for less than one year.
  • If you travel between your main job and a second job.
  • If you travel between your home and a temporary work location if your main job is at another site.
  • If you travel from your regular workplace to a temporary job site.
  • If you travel between a temporary work location and your second job.
  • If you have a deductible home office, and you travel to your main job, this is considered as driving between workplaces.

Talk to the Mileage Experts Here at TripLog

The team here at TripLog pride ourselves on our knowledge and understanding of all things mileage and expense reimbursement. TripLog’s mileage tracker app gives drivers an accurate and efficient way to track their mileage, and our comprehensive web dashboard gives administrators full access to their team’s reports.

To learn more about how TripLog can help save your company time and money, business owners can schedule a complimentary live web demo for your company. Feel free to ask for more information on how TripLog can help manage your team’s commutes!

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Mileage Reimbursement Savings Calculator

Using outdated manual mileage logs can cost businesses thousands of dollars per year in lost time and incorrect reimbursements. See how much TripLog can help you save!

Number of drivers

Average miles daily per person​

Number of trips daily

Cents-per-mile

Annual mileage reimbursement costs based on the numbers you provided.

Annual Mileage Reimbursement

50 mi/day x 100 drivers x $0.54 (5 days x 50 wks)

$675,000

This is the inline help tip! You can explain to your users what this section of your web app is about.

According to research, on average employees inflate the mileage by 25% when self reported.

Estimated Reimbursement Savings

25% x Annual Mileage Reimbursement

$168,750

People on average spend 2 minutes on manually recording trips.

Manual Entry Hours

2 mins x 10 trips/day x 100 drivers (5 days x 50 wks)

8,334 hr

Taking national average $25 hourly rate.

Estimated Labor Savings

Avg. $25/hr x Manual Entry Hours

$208,334

Your Company

could save

(Labor Savings + Reimbursement Savings) / Number of Drivers

$4,167

per driver