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In Pennsylvania, the Board of Governors' Policy 1986-07-A mandates mileage reimbursement for state employees and lays out its guidelines. However, it's optional for you as a private employer whether or not (and how much) you reimburse your employees for mileage.
Having said that, while the state does not mandate you to reimburse for mileage, you are still legally bound to the Pennsylvania Minimum Wage Act, which can influence reimbursement practices.
Moreover, when you choose to reimburse your employees for mileage, you create a fair system, which boosts your team's morale as they know they will not have to pay for mileage out of their own pockets.
Pennsylvania business mileage reimbursement rates
As you plan for 2024, it's important to know that Pennsylvania's business mileage reimbursement rate follows the IRS standard of 67 cents per mile. You can choose to reimburse at this rate or adjust higher or lower. Just keep in mind that any amount above the IRS standard is taxable.
Here's a tabulated snapshot of the mileage reimbursement rates in 2024 alongside a year-on-year mileage reimbursement comparison.
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.
Pennsylvania mileage reimbursement calculator
Using the Pennsylvania 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.
Pennsylvania mileage reimbursement laws
In Pennsylvania, understanding the nuances of mileage reimbursement laws ensures you stay compliant with the Minimum Wage Law in the state and maintain a supportive work environment.
While Pennsylvania doesn't impose a statewide mandate on you as a private employer to provide mileage reimbursement, specific regulations discussed below will guide how you might approach the mileage reimbursement rates for your business.
Board of governors' policy 1986-07-A for state employees
The Board of Governors' Policy 1986-07-A outlines the travel expense regulations for state employees, effective since October 12, 1986, and amended last on April 9, 1998. It mandates that all travel expenses, including mileage, must be economically managed.
As per this policy, state employees using personal automobiles for state business are reimbursed at a rate set by the chancellor. This rate accounts for all operational costs of the vehicle, such as:
- Fuel
- Insurance
- Maintenance
Also, the policy explicitly states that this mileage reimbursement rate covers all necessary expenses except parking and tolls, which are reimbursed separately.
Pennsylvania minimum wage act and mileage reimbursement
The Minimum Wage Act in Pennsylvania is pivotal in ensuring your employees are fairly compensated for their labor. Although it doesn't directly mandate mileage reimbursement, it plays a significant role when considering travel expenses as part of overall compensation.
The act requires that any work-related expenses, like mileage, that are not reimbursed should not bring your employees' earnings below the minimum wage, currently set at $7.25 per hour.
If travel expenses essential to an employee's duties aren't compensated and result in their effective pay falling below this threshold, you could accidentally violate the Minimum Wage law. Therefore, it's crucial to consider these costs as part of the compensation package to adhere to the law and ensure fair treatment.
Improve mileage logging accuracy with Ramp
In Pennsylvania, diligently following the mileage reimbursement guidelines as outlined in the Board of Governors' Policy 1986-07-A is mandatory for the public sector and an optional but smart decision for you as a private-sector employer.
These regulations ensure the following things.
- Reimburse your employees fairly for the business use of their personal vehicles
- Ensure your business complies with the Minimum Wage Law in Pennsylvania
- Build a trustworthy work environment
Want to simplify this critical compliance by automating the mileage tracking process? With Ramp, you can effortlessly maintain accurate mileage records and calculations that meet Pennsylvania requirements.
Ramp's AI-boosted expense management software streamlines the reimbursement process and minimizes the risk of errors and disputes, ensuring that you and your employees benefit from clear, consistent, and fair mileage compensation practices.
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