New Mexico mileage reimbursement rates

Mileage reimbursement is a way to cover the costs your employees incur when using their personal vehicles for work-related purposes. 

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In New Mexico, state employees must be reimbursed at 100% of the IRS standard mileage rate from the previous year, rounded to the nearest cent, as laid out in the New Mexico Administrative Code, 2.42.2. While this is mandatory for state employees, you, as a private employer, aren't required by law to offer mileage reimbursement. 

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Nevertheless, offering mileage reimbursement helps in the following ways.

• Keep your employees motivated. 
• Keep your business aligned with the Workers' Compensation Act, which makes mileage reimbursement for injured employees mandatory. 

New Mexico business mileage reimbursement rates 

In 2024, the mileage reimbursement rate in New Mexico is 66 cents per mile, based on the IRS standard rate (rounded off to the nearest cent) from the previous year. Before 2024, the rates for state employees used to be 80% of the IRS rates of the prior year. 

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For private employers, while the law doesn't require you to follow this rate, you should establish a clear policy that fairly addresses mileage expenses for your employees to avoid potential disputes under Section 11.4.3 of the Workers' Compensation Law.

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Here's a snapshot of the business mileage reimbursement rates in New Mexico.

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New Mexico mileage reimbursement laws

New Mexico has specific laws governing mileage reimbursement that are essential for you to understand. 

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For state employees, mileage reimbursement follows the rules under §2.42.2, which outlines who qualifies and what rate applies. For you, a private employer, the law does not mandate that you offer mileage reimbursement unless under Section 11.4.3 of the Workers' Compensation Law. 

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Explore the upcoming sections to develop a deeper understanding of all these regulations.

Code §2.42.2 for state employees' mileage reimbursement in New Mexico^[1]

Previously, New Mexico state employees were reimbursed at 80% of the IRS standard mileage rate from the previous year. However, as of 2024, state employees are reimbursed at 100% of the IRS mileage rate of the prior year, rounded to the nearest cent.

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In 2024, state employees receive 66 cents per mile for business-related travel. The New Mexico Department of Finance and Administration sets these rates.

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Please note: Only state employees using personal vehicles for official duties in the state's best interest are eligible for mileage reimbursement.

Section 11.4.3 of the workers' compensation act for mileage reimbursement 

Under the Workers' Compensation Act, mileage reimbursement is non-negotiable even for you as a private employer. 

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Section 11.4.3 of the Workers' Compensation Act^[2] states that, as a private employer, you must pay mileage to injured employees traveling 15 miles or more, one way, from their home or workplace. 

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Here's a tabulated version of business mileage reimbursement rates in NM for injured employees, set by the New Mexico Department of Finance and Administration.

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New Mexico minimum wage act (50-4-20) and its impact on mileage reimbursement

The New Mexico Minimum Wage Act sets the hourly wage for most employees statewide. As of 2024, the minimum wage is $12.00 per hour, overseen by the New Mexico Department of Workforce Solutions.

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While the act doesn't directly govern mileage reimbursement, it impacts it. Here's how – If non-reimbursement of mileage reduces your employees' wages below the state minimum, you must pay the difference.

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As per section 50-4-20, here’s what you need to do:

• Pay tipped employees $3.00 per hour, ensuring tips bring their total to $12.00 or more.
• Pay employees under 18 a lower wage of $10.50 per hour during their first 90 days.

Simplify your mileage tracking process with Ramp

Offering mileage reimbursement is not a legal obligation you must fulfill as a private employer in New Mexico. However, offering your employees fair compensation for mileage when they use their vehicles for business duties is beneficial in many ways, as listed below. 

• Make sure your business does not violate the Minimum Wage Law and the Workers' Compensation Act.
• Show your employees you value their time and resources.
• Keep your employees motivated by creating a fair workplace.

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By implementing clear reimbursement practices, you can avoid disputes, promote fairness, and keep your business running smoothly. That's where Ramp comes in. 

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Ramp's AI-powered expense management software automates your mileage tracking and reimbursement processes, eliminating manual entry, reducing errors, and ensuring timely payments. 

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With Ramp, you can easily track mileage, stay compliant with New Mexico laws, and focus on running your business while keeping your employees satisfied.