Georgia Mileage Reimbursement: What You Need to Know

Introduction

Georgia’s long been known for southern sunshine, but lately more as an postproduction outpost for Hollywood blockbusters, given the state’s attractive tax incentive scheme for job creators.

We’ll lay out Georgia’s rules concerning mileage reimbursement for drivers, and what that means for you and your employees.

What is a mileage reimbursement?

In the 20^th century, private and public companies often leased or bought whole ‘fleets’ of company cars for their employees to use while performing business duties.

While a nice idea in theory, this becomes very expensive in practice. If an employee crashes a company car, it’s the business that’s liable for any damages, and insurance companies could charge top rates, knowing the business has more resources to marshal against a claim than an individual driver does.

The business is also responsible for any repairs, maintenance, insurance premiums, or leasing fees applicable to their fleet.

While large corporations have enough purchasing power to justify operating fleets—bulk volume discount seems to be a universal law of business—the same cannot be said for the average small-to-midsize business.

Since their employees often drive their personal vehicles to and from work anyway, wouldn’t it make sense to allow them to use their personal vehicles (and personal vehicle insurance) for business purposes, while also ensuring they’re not personally on the hook for gas, maintenance, and other fees that can come up during the course of a workweek?

Some companies offer a ‘car allowance’, which is typically a flat amount on top of an employee’s salary. We’ve written extensively about how inefficient this is from both a cost and taxation perspective, if you need a refresher.

Alternatively, businesses and their employees can pay an IRS-compliant vehicle reimbursement, and this is tax-free for state and federal taxes.

What do Georgia state tax laws have to say about mileage reimbursement?

There is no global tax law for all workers in Georgia. Some state agencies do have specific policies outlining how their statal employees are reimbursed. 

In the Georgia State Accounting Office’s official State Travel Policy, available here[1], there is a schedule covering all the rules and regulations concerning ground travel for state employees.

Luckily, we’ve read the document so you don’t have to. What’s most important for you reading this article is understanding the state of Georgia’s regulations concerning mileage reimbursements and use of personal vehicles for business-related travel.

Section Two of the Georgia SAO Statewide Accounting Policy and Procedure states the following:

• (State) Employees should make every effort to use the least expensive method of ground travel available. (Not a bad practice for your employees, either.)
• If a temporary fleet vehicle (i.e., a rental car) is not available, travelers may choose between a rental vehicle or mileage reimbursement for use of their personal vehicle.
• Reimbursement for business use of a personally-owned vehicle is calculated per business-use mile, from point of departure to point of arrival, including any way points and deducting actual commute mileage, as applicable.

It’s crucial to know that your commute to and from work is not considered business use of a personal vehicle in the state of Georgia.

I’m not an employee of the State of Georgia. Do these regulations apply to me?

Not specifically, although many companies do offer reimbursement programs to their employees that do align with state regulations.

We can ignore the specific clauses focused on the state government’s procurement procedures for employees, for example, but pay close attention to those concerning mileage reimbursement for employees. Offering mileage reimbursement rates at or above the state standard will ensure your business remains an attractive option for workers in today’s tight labor market. So while it’s not the law that you have to reimburse employees in Georgia, it sure is a great option.

Expense tracking and reporting mileage reimbursement rate for the State of Georgia

The most crucial aspect of claiming the state mileage reimbursement rate for state employees is proper expense tracking and justifying each trip as properly related to your business needs.

To have compliant mileage logs, it is best to include destination-to-destination logging, precise information on what business activities were conducted during the trip, geolocation data confirming the route was as efficient and reasonable as possible, and exact odometer counts to ensure mileage count is accurate.

The State travel guidelines explicitly state that if these expense reports are not provided within 45 days, they may be rejected for reimbursement, and are highly likely to be rejected if not provided within sixty days.[2]

What is Georgia’s mileage reimbursement rate for 2023?

Georgia hasn’t set their own independent state mileage reimbursement rate for 2023 (or for any year prior). They provide mileage policy updates twice a year, but as you’ll see when you read it, this rate is functionally identical to the Federal Government’s General Services Administration rate, which also happens to be the same as IRS standard business mileage reimbursement rate, even if it’s written on state letterhead.

We can therefore rely on the Internal Revenue Service’s standard business mileage reimbursement rate, which for 2023 is 65.5 cents per mile. The rate changes once or twice per year.

What if I want to offer employees something else?

The good news is, even if you are operating in the state of Georgia, you have far more options for employee mileage reimbursement than the standard cents per mile rate listed above.

Cardata offers business owners a variety of mileage reimbursement plans, from FAVR structures to Tax-Free Car Allowance. And Cardata Mobile and Cardata Cloud make route tracking and submitting expense reports a breeze. Drop us a line to learn about how we save you cents on every mile.

[1] State Travel Policy | State Accounting Office of Georgia 

[2] Statewide Accounting Policy & Procedure 

[3] UGA Mileage Reimbursement

^{Disclaimer: Nothing in this blog post is legal, accounting, or insurance advice. Consult your lawyer, accountant, or insurance agent, and do not rely on the information contained herein for any business or personal financial or legal decision-making. While we strive to be as reliable as possible, we are neither lawyers nor accountants or agents. For several citations of IRS publications on which we base our blog content ideas, please always consult this article: https://www.cardata.co/blog/irs-rules-for-mileage-reimbursements. For Cardata’s terms of service, go here: https://www.cardata.co/terms.}