IRS makes mid-year adjustment to mileage reimbursement rate
The rate agencies use to reimburse federal employees who use their own cars for work could go up by 8 cents, if the government continues its pattern of using the Internal Revenue Service figures.
The IRS announced on Tuesday that beginning July 1, the standard rate used to calculate the deductible costs of operating an automobile for business purposes will be increased to 58.5 cents per mile, the highest rate ever. The current rate, set in the fall of 2007, is 50.5 cents per mile.
The new rate will be in effect until Dec. 31. The IRS normally updates mileage rates once in the fall for the next calendar year.
"Rising gas prices are having a major impact on individual Americans," IRS Commissioner Doug Shulman said. "Given the increase in prices, the IRS is adjusting the standard mileage rates to better reflect the real cost of operating an automobile."
The General Services Administration is permitted under federal law to establish a reimbursement rate for federal employees who use personal vehicles for business, but it cannot exceed the figure established by the IRS. In the past, GSA has consistently followed the IRS' lead.
GSA also is required to conduct annual studies on the costs associated with travel and operation of privately owned vehicles. The agency is supposed to consult with the Transportation and Defense departments and federal employee organizations in determining the reimbursement rate.
On June 13, the National Treasury Employees Union called for a mid-year rate increase, noting that high gas prices were "placing an especially heavy burden on those who must travel to perform their work duties."
NTEU President Colleen M. Kelley said she would send a letter to GSA on Tuesday asking for immediate action in extending the higher mileage reimbursement rate to federal employees. She said NTEU would continue to lobby for legislation that would grant an even bigger reimbursement increase and make any boost in the IRS rate immediately applicable to federal employees.
According to federal travel regulations, employees may use personal vehicles for official travel if they obtain permission from their agency. The reimbursement rates apply only to authorized means of travel.
The mileage reimbursement does not pertain to employee transfers or relocations. Those are designated as transportation expenses, rather than allowances for the cost and operation of a vehicle, according to GSA.