Compliance Matters TM

IRS Increases Standard Mileage Expense Reimbursement Rates Effective July 1, 2022

On June 9th, the IRS announced that it was increasing the standard mileage reimbursement rates effective July 1, 2022. While the IRS typically updates mileage rates at the end of the year, skyrocketing gas prices prompted a special midyear adjustment. The last time the IRS made a midyear increase was in 2011.

The new mileage reimbursement rates are as follows:


1/1/22 to 6/30/22 

7/1/22 to 12/31/22

Business Use

58.5 cents per mile

62.5 cents per mile

Medical Care & Moving Expenses (active-duty military)

18 cents per mile

22 cents per mile


14 cents per mile

14 cents per mile

The standard mileage rates are used to calculate costs that are deductible by a business or self-employed individual for operating an automobile for business use, medical or moving purposes, or in service of a charitable organization. Additionally, the optional standard mileage rate can be used by businesses to reimburse employees who use their own vehicles for business purposes. While employers have the option of calculating actual vehicle costs for reimbursement, using the optional business standard mileage rate provides a safe harbor under federal and California law.

Importantly, the IRS announcement states that the new mileage rates apply to expenses either paid or incurred on or after July 1, 2022. Employers using the standard mileage rates in lieu of calculating actual costs must ensure that they are using the new rates immediately.

Employers should ensure that employees are tracking expenses and submitting expense reports for actual business mileage. Remember, the IRS rate is a safe harbor that should suffice in most situations. However, under California law, if an employee claims that their actual vehicle maintenance costs are higher, the employee has the right to that reimbursement if the employee can prove that the employee’s actual vehicle maintenance costs are indeed higher with soaring gasoline prices.

Recall also that both California and Federal law prohibit any kind of workplace retaliation against employees who assert their right to these wage or expense reimbursement payments.

If you have any questions about the matters discussed in this issue of Compliance Matters, please call your firm contact at 818-508-3700 or visit us online at


Richard S. Rosenberg

Katherine A. Hren

Charles W. Foster
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