2006 IRS Mileage Rate
The IRS recently announced the 2006 mileage rate is set at 44.5 cents per mile. This rate is important for California employers because the California DLSE has opined that if employers reimburse employees' travel expenses at the IRS rate they will have met their obligations under the California labor code requiring employers to reimburse employees for all expenses incurred on behalf of the employer. (Click here to see a prior post on this topic)
For the first eight months of 2005, the rate was set at 40.5 cents per mile. In September the IRS made a special one-time adjustment for the last four months of 2005, raising the rate for business miles to 48.5 cents per mile in response to a sharp increase in gas prices, which topped $3 a gallon.
"The IRS took the extraordinary step of temporarily increasing the standard mileage rates in the aftermath of Hurricane Katrina," IRS Commissioner Mark W. Everson said. "We promised to continue closely monitoring the situation. The 2006 mileage rates reflect that gas prices have dropped."
The IRS announcement can be found here.