If you use your own vehicle for your job, you may be able to request reimbursement for your mileage. It isn't taxable income as long as the employer follows the applicable Internal Revenue Service and state rules. No Colorado state laws regulate mileage reimbursement for private employers. Employees of private companies are only covered by the Internal Revenue Service's rules. As with any important tax matter, contact an accountant or tax attorney if you are not sure if the reimbursement is deductible.
The Colorado Department of Personnel and Administration sets the mileage rules for state employees and officers. The reimbursement rate for normal driving in a personal two-wheel drive vehicle is 90 percent of the IRS mileage rate. It goes up to 95 percent if the employee must use a four-wheel drive vehicle due to adverse weather or road conditions. The state only allows the reimbursement if the trip is for official state business.
The mileage rate is adjusted annually to keep up with the cost of living. In 2015, the rate was 57.5 cents per mile driven for business, 23 cents per mile driven for a move or medical treatment, and 14 cents per mile driven for a charitable organization. You must itemize your deductions on Schedule A to claim mileage reimbursement. You can also claim the actual costs of operating your vehicle, such as oil, gas and repairs. If you previously claimed accelerated depreciation on the same vehicle, you must use the actual costs instead of the standard mileage rate.
You must keep a mileage log that includes detailed records of each trip in case the IRS audits your tax return. The log must list the trip date, destination, purpose and miles driven. If you spend part of the trip on personal business, you must subtract the personal mileage from your total before applying for reimbursement.
Rules for Aircraft
In certain situations, a state employee may be asked to fly his own private aircraft on government business. The state must reimburse these trips at 40 cents per nautical mile. Air mileage reimbursements must follow similar documentation guidelines as ground reimbursements, such as tracking the date, destination and miles flown. The pilot must also note the type of aircraft used for each trip.
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