Contributed by Rev. Thomas G. James
Do you travel for work? Do you ever have your mileage costs reimbursed by your employer? If so, you will want to make sure you’re aware of the new Federal guidelines regarding the IRS standard mileage reimbursement rate.
- As of July 1, 2026, the updated mileage reimbursement rate has been increased to 76 cents per mile.
Clergy Mileage Reimbursements
Our United Methodist pastors often travel for work purposes, whether traveling to visit parishioners, community members, or for conference and district meetings. These miles are often reimbursed out of the Pastor’s Accountable Reimbursement plan set by the Charge Conference. Many churches provide a separate Professional Expenses budget account to support the travel costs of their pastors. For travel that took place after July 1, 2026, the new mileage reimbursement rate is 76 cents per mile.
Many of our clergy submit their reimbursements en masse after piling up a few months of receipts and mileage. First, to my clergy colleagues, stop that. It is helpful for tracking the expenses of the church if your reimbursements are processed in the month the travel or purchase took place. Processing reimbursements in the month they took place provides a more accurate reflection of the financial life of the church month over month. But more importantly, if you are requesting mileage reimbursements for travel that took place prior to July 1, 2026, those miles should be reimbursed at the prior reimbursement rate of 72.5 cents per mile.
The mileage reimbursement rate is determined by the date of travel, not the date the reimbursement is submitted or processed.
Volunteer Mileage Reimbursements
The volunteer mileage reimbursement rate has not changed, which remains at 14 cents per mile. If your church reimburses volunteers for mileage related to church programs, like driving for a mission trip or transporting canned goods for a food drive, you may reimburse volunteers at 14 cents per mile without any tax implications for your volunteers. If your church reimburses volunteers at a higher rate, any amount paid above 14 cents per mile should be considered taxable income for the volunteer. If the amount of taxable mileage reimbursements for any individual volunteer exceeds $2,000 for the calendar year, you should file a 1099 for the volunteer, recording the mileage reimbursements as non-employment income.
Are All Miles Reimbursable?
No, not all miles driven are reimbursable. The IRS stipulates that you may not be reimbursed for mileage that is part of your daily commute. If your primary office is in the church, a pastor may not request reimbursement for mileage to and from the church. This caveat also requires you to subtract the mileage of your normal commute if you are travelling to a different location on a normal workday.
For example, assume a pastor has a normal commute of 2 miles from home to church. If on a normal workday, the pastor needs to visit the hospital instead of going to the church, and the hospital is a 5-mile drive, the pastor should only request a reimbursement for 3 miles (or 6 miles round trip). If the pastor drives to the hospital for visitation and then proceeds to drive to the church, they may request a reimbursement of 3 miles enroute to the hospital and add in the mileage from the hospital to the church.
Mileage Reimbursement vs Tax Write-off
Not every business is willing to reimburse their employees for mileage travelled. Clergy or not, you may fall into this category. Prior IRS code allowed standard W-2 employees to write off unreimbursed mileage, but since the Tax Cuts and Jobs Act passed in 2017, this is no longer uniformly possible. Under current IRS code, the only individuals allowed to write off unreimbursed work mileage are self-employed or small business owners, including independent contractors. Other allowances are made for qualified performing artists and reservists in the armed forces, among a small group of other employment groups. When filing their taxes, these individuals may use the standard mileage rate or actual vehicle expenses to write off unreimbursed work mileage.
If your company has an expectation for standard employees to travel outside of their daily office commute, you may want to add a mileage reimbursement option into their contract knowing they cannot write off their unreimbursed work miles on their taxes.
The full list of mileage reimbursements rates can be found on the IRS website.