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In New Jersey (NJ), reimbursing state employees for mileage isn't just a courtesy — it's a requirement mandated by Section 1 of P.L.1943, chapter 188. However, this isn't the case in the private sector, where you're not obligated to reimburse for mileage.
Still, offering mileage reimbursement is a goodwill gesture that helps you achieve the following benefits.
- Encourage staff retention through fair reimbursement.
- Ensure your team's overall financial well-being.
- Keep your business aligned with New Jersey's Minimum Wage Law.
- Ensure adherence to NJ's Workers' Compensation Law.
New Jersey business mileage reimbursement rates
For 2024, New Jersey's mileage reimbursement rate for state employees is set at $0.67 per mile, in line with the IRS standard. The state law mandates this rate for public workers.
As a private employer, you are not required to offer mileage reimbursement. However, you can choose to align with the IRS rates — tabulated below alongside the year-on-year rate analysis — for consistency and employee satisfaction.
Please note: You may reimburse your employees at rates above or below the IRS standard. However, any excess reimbursement over the IRS rate is subject to taxation as income.
New Jersey mileage reimbursement calculator
Using the New Jersey mileage reimbursement calculator is straightforward.
- Choose the tax year for which you want to calculate.
- Input the miles driven to determine how much money can be received in return.
New Jersey mileage reimbursement laws
In New Jersey, mileage reimbursement, as per Section 1 of P.L.1943, ensures that state employees who use personal vehicles for business purposes are fairly compensated 67 cents per mile, which the IRS sets. However, as a private employer, you can operate under more flexible guidelines.
Here's a detailed breakdown of all critical New Jersey mileage reimbursement governing laws and policies.
Mileage reimbursement policies for state employees
In New Jersey, mileage reimbursement for state employees is mandatory, as stipulated by Circular 20-04-OMB[1]. This circular sets the current mileage reimbursement rate at $0.67 per mile. Additionally, the state is directed to reimburse employees for parking and toll charges.
This requirement is legally reinforced by Section 1 of P.L.1943, c.188 (C.52:14-17.1), which mandates mileage reimbursement at the federal IRS rate for all state employees using personal vehicles for state duties.
New Jersey’s workers' comp law and its implications on mileage reimbursement
In New Jersey, employees injured on the job are entitled to Workers' Compensation as outlined in Section 34:15-1[2] of the Workers' Compensation Law[3]. While this law doesn't require you to cover travel expenses for medical visits, it does mandate that you reimburse your employees for necessary medical benefits, including:
- Medical treatment
- Prescription drugs
- Hospital services
Knowing this helps you communicate the extent of workers' compensation benefits to your employees.
New Jersey minimum wage act and mileage reimbursement
The New Jersey Wage Act sets wage standards, including a general minimum wage of $15.13 per hour in 2024, with variations for different worker categories. This tiered wage structure – given below – influences how you might handle mileage reimbursement, though mileage is not directly covered by the Minimum Wage Act.
- For agricultural workers: Gradual increase to $15 per hour by 2027, currently at $12.81.
- For tipped workers: Minimum cash wage of $5.26 per hour, with up to $9.87 in tip credits.
Please note: These rates are set by the New Jersey Department of Labor and Workforce Development (NJDOL).
New Jersey vs federal mileage reimbursement rules
At the federal level, the IRS sets the standard mileage rate at $0.67 per mile for 2024, which employers use to keep reimbursements non-taxable. New Jersey's approach is split between the state and private sector.
While state employees are reimbursed for mileage at the IRS federal rate, you, a private employer, are not legally required to provide mileage reimbursement at all. However, this absence of a statutory requirement places the responsibility on you to establish internal policies that are fair and clear to all employees.
Automate mileage tracking to eliminate logging errors with Ramp
Understanding New Jersey's mileage reimbursement rules really pays off. When you get mileage reimbursement right, it helps in many ways.
- Boost your team's morale, building their trust in you.
- Ensure you do not accidentally violate NJ's Minimum Wage Law.
Ultimately, fair mileage reimbursement ensures that everyone wins — your employees feel appreciated, and you cultivate a loyal, motivated workforce. Wondering how you can streamline this process of mileage tracking and reimbursement? The answer remains intact with Ramp.
With Ramp’s automated AI-powered expense management software, you can minimize logging errors and ensure timely reimbursements for all your employees. By integrating Ramp into your operations, you can maintain accurate mileage records logs, making adhering to state and federal guidelines easier.
Related posts
[1] Under the header, ‘Transportation by personal vehicle (mileage basis)’: https://www.nj.gov/infobank/circular/cir20-04-OMB.pdf
[2] Under the header, ‘34:15-1. employees’ right to recover for negligent injury’: https://www.nj.gov/labor/workerscompensation/assets/PDFs/Forms/wc_law.pdf
[3] Under the header, ‘What is workers' compensation?’: https://www.nj.gov/labor/workerscompensation/assets/PDFs/Forms/WC-373.pdf
