Mileage Reimbursement in Delaware

Known for being the “First State,” Delaware has a rich history of innovation and corporate presence. With over half of the country’s publicly traded companies incorporated here, the state is not just an economic hub—it is also a pioneer in modern corporate law. Against that backdrop, however, many Delaware employers and employees still wonder: how does the state handle mileage reimbursement for work-related travel?

What is the Delaware mileage reimbursement rate?

If you’re a state employee, Delaware’s Code Title 29, Chapter 71, § 7102 sets the authorized mileage rate at 50 cents per mile (effective as of July 1, 2023). This rate applies to any miles driven in the course of official state business, provided you submit an itemized statement of those business-related miles as described in § 7103.

But what if you’re a private-sector employer or employee? In Delaware, as in many other states, there is no specific mileage reimbursement law for private employers. This means private employers are not strictly required to match the state’s 50 cent rate. Many businesses, however, use either Delaware’s state-employee rate or the IRS’s federal standard mileage rate as a benchmark. For tax year 2025, the IRS’s rate was 70 cents per mile. 

Using the IRS rate generally allows you to avoid extra income or payroll tax on reimbursements, as long as you require employees to track their business mileage carefully. If you do decide to pay above the IRS rate, the portion above the IRS limit typically becomes taxable income.

Delaware state employees: In-depth look at Title 29, Chapter 71

1. Mileage rate and itemized statements

• Rate: As noted, it’s set at 50 cents per mile for state employees (29 Del. C. § 7102).
• Reporting: Under § 7103, you must provide an itemized list showing the total miles driven for official business, excluding any commute miles between your home and your main place of work.

2. Penalties for overpayment

• Overpayment fines: § 7104 sets out fines for overpaying mileage or incorrectly filing mileage claims. Fines range from $10 to $100, and repeat offenders or egregious cases can face liability up to twice the excess amount received.

3. When mileage is not reimbursed

• Excluded commutes: Delaware law is clear that mileage between your home and principal workplace is not reimbursable, unless authorized under specific exceptions.

If you’re working in a public agency, it’s important to familiarize yourself with these guidelines and keep thorough records of work-related miles. This protects both you and your agency from improper claims.

Mileage reimbursement for private employers in Delaware

1. No mandate, but recommended

There is no Delaware state law that forces private businesses to reimburse mileage. That said, many choose to do so for fairness, competitiveness in hiring, and to avoid inadvertently dipping an employee’s net pay below the minimum wage once travel costs are factored in.

2. Workers’ compensation

Under Delaware’s Workers’ Compensation Act (Title 19, Chapter 23, § 2322), employers must cover travel expenses (including mileage) for employees who need medical care after a work-related injury. This is a separate and mandatory scenario—so if you have staff with active workers’ comp claims, be sure to stay compliant.

3. Delaware’s minimum wage consideration

Starting in 2025, Delaware’s minimum wage will be $15.00 per hour, and failing to meet that standard—especially if non-reimbursed business-related mileage effectively lowers an employee’s net pay—could expose your organization to wage-and-hour claims or fines. While you don’t have to follow Delaware’s 50 cent rate or the IRS rate exactly, choosing one of these common benchmarks will help you stay in safe legal territory and maintain employee morale.

How to approach mileage reimbursement in Delaware

1. Pick a benchmark
   • If you’re a state agency, you must follow the state’s 50 cent per mile rate.
   • If you’re a private employer, decide whether you will follow Delaware’s 50 cent benchmark, the IRS standard mileage rate, or another set rate that ensures employees aren’t left with undue costs.
2. Require thorough documentation
   • Any mileage reimbursement plan hinges on accurate logs. Have employees maintain a log detailing each trip’s date, purpose, start and end odometer readings, and total miles driven.
3. Stay above the minimum wage
   • If your employees cover significant travel on your behalf and are near or at minimum wage, failing to reimburse might inadvertently push their effective hourly pay below the required $15.00 per hour (as of 2025). Keep an eye on this to avoid wage-and-hour complaints.
4. Be mindful of taxes
   • Reimbursements at or below the IRS rate can usually be treated as tax-free, provided your policy meets “accountable plan” rules (i.e., employees submit logs, and you don’t over-reimburse). Any amount over the IRS rate is typically taxable as income.
5. Workers’ compensation
   • Always remember to reimburse mileage for medical visits stemming from workplace injuries—this requirement isn’t optional in Delaware, and neglecting it can incur fines.

Conclusion

Delaware may be a small state, but it has sizable influence in corporate and financial spheres. Whether you’re a private employer looking to remain competitive (and compliant) or a public employee seeking clarity, staying informed about mileage reimbursement is best.

• State employees can confidently claim 50 cents per mile, as set by Delaware Code.
• Private employers have more flexibility—yet also a responsibility to ensure their employees aren’t shouldering work-related travel costs that push wages below the state minimum.
• Workers’ compensation always requires covering medical-related travel, so be sure to follow that law carefully.

If all of this sounds complicated, don’t panic. With accurate recordkeeping and a well-structured reimbursement plan, you can keep your employees happy, your organization compliant, and your finances in order. As Delaware continues to attract new businesses and talent, having a transparent, fair mileage reimbursement process will help you stand out in the “First State.”

(Disclaimer: This blog is for informational purposes only and does not constitute legal or tax advice. For advice specific to your business or situation, consult an attorney or tax professional.)