Toll Reimbursement

Toll expenses are costs incurred when using toll roads during business travel. These expenses are not included in standard mileage reimbursement rates.

Instead, tolls can be reimbursed separately on a tax-free basis using the actual expenses method outlined in IRS Publication 463. The same approach applies to related costs, such as parking.

Because tolls are not tied to mileage, they need to be tracked and recorded separately. To qualify for tax-free reimbursement, drivers should:

• Keep a record of tolls associated with business trips
• Retain receipts, toll statements, or electronic logs as supporting documentation

Toll expenses can be reimbursed alongside programs like Fixed and Variable Rate (FAVR), Tax-Free Car Allowance (TFCA), and Cents-Per-Mile (CPM), as long as proper documentation is maintained.

Keeping accurate records of toll expenses helps ensure reimbursements remain compliant, properly documented, and eligible for tax-free treatment.