How well is your company managing their expense and mileage reimbursement program? Take the quiz and see how much you really know about reimbursement law, deductible business expenses and managing the employee reimbursement process.
1. Are employers mandated by federal law to provide employees with mileage reimbursement?
C. Only if employees use their own vehicles for business travel
D. No, except for situations affected by the Federal Labor Standards Act kickback rule that pushes an employee’s salary under the minimum wage
2. What is the IRS standard mileage rate?
A. The legal definition for the length of a mile
B. The rate you must travel at to escape the IRS
C. An optional rate used to compute the deductible costs of operating an automobile for business, charitable, medical or moving expense purposes
D. A rate taxpayers must use to compute the deductible costs of operating an automobile for business, charitable, medical or moving expense purposes
3. When does travel count as a tax-exempt, deductible expense?
A. When it has a business-related purpose
B. When it can be substantiated by records proving the time, place and purpose of the travel
C. When excess reimbursement payments are returned to the employer
D. All of the above
4. Which of these choices is NOT an example of business travel?
A. Driving from home to work (and vice versa)
B. Driving to meet a client offsite
C. Driving to pick up office supplies
D. Driving to attend a conference
5. True or false? Even when your employees drive a company-owned vehicle, you should still reimburse them at the IRS standard mileage rate.
6. How often does the IRS update their standard mileage rates?
C. Only as needed
7. Mileage reimbursements are considered taxable wages if:
A. Employers choose not to follow the rules of an IRS accountable plan
B. Employers don’t use the IRS standard mileage rate
C. Employees track their mileage with a mobile app
D. Employees drive an older model vehicle for work-related purposes
8. True or false? The IRS determines the standard mileage rate based on a variety of expenses related to operating a vehicle including maintenance, fees, licensing, depreciation and fuel.
9. True or false? A car allowance is treated similarly to a mileage reimbursement by the IRS and is therefore tax deductible.
Bonus: What is the most reliable way for employees to track their business mileage?
A. Recorded odometer readings in a mileage log
B. Point-to-point trip calculations
C. GPS-based tracking system
D. Employees don’t need to track their business mileage
Answers: 1-D; 2-C; 3-D; 4-A; 5-F; 6-B; 7-A; 8-T; 9-F; 10-B
Something You May Not Know
CompanyMileage’s feature-packed mileage tracking and expense management software, SureMileage, can strengthen any company’s reimbursement program. Point-to-point calculations ensure accuracy every time, and an automated reimbursement process helps employees get their reimbursements faster with an organized, straightforward system. Request a demo with CompanyMileage today to learn how we can save you 20-30% on mileage reimbursements.