Mileage Reimbursement Look-Back: 2024 to 2026

Pick a year and enter what you were paying delivery drivers then. This returns two answers that fail independently: whether the method you used would survive being looked at, and the distance between what you paid per mile and what a delivery mile actually cost in your state that year. Nothing is sent anywhere and it does not ask for your email.

What this checks, and what it cannot

Most operators find out their reimbursement was wrong from a letter, not from a spreadsheet. The sentence that arrives with it is usually some version of: "we have always paid two dollars a run, and nobody ever raised it."

That is a fair description of how the last three years actually went. Nobody raises it, until one person does, and then the question is not what you pay now. It is what you paid then, for every driver, for as far back as the clock reaches.

This calculator answers that in two parts. First, whether the way you reimbursed would survive being looked at, which is a question about method and has a yes or no answer. Second, the distance between what you paid per mile and what a delivery mile actually cost in your state that year, which is a modeled number and is presented as a range. Pick a year, put in what you were paying, and read both.

It checks two things that fail separately, which is the part most operators miss. A reimbursement can be perfectly adequate in dollars and still be structured so that every dollar of it is taxable wages. It can also be structured correctly and still be too small. You can lose either one on its own, and losing both at once is common.

What it cannot do is quote your premium, your driver's actual repair bills, or a legal opinion. The cost figure is modeled from our own rate engine, and the modeling is honest about its own limits: the fuel price is the real weekly average for your region in the year you pick, because we hold five years of it, while insurance and vehicle values are held at current filed levels because we do not hold their history. Every dollar figure below is illustrative and modeled, and the ranges are wide on purpose.

The look-back is longer than the year you are worried about

The reason to check 2024 and not just this month is that the clock does not start when someone complains. Under the FLSA the recovery period runs two years back, and three if the failure is found to be willful, which in practice means a shop that was told and carried on. State expense-reimbursement statutes run on their own timetables, several of them longer. The tax side has its own exposure and its own clock, and neither waits for the other.

So a reimbursement method you changed last spring does not close the years behind it. Those years are still sitting there in the payroll file, priced at whatever you were paying at the time, and they are the ones the calculator above is asking about.

Two tests, and they fail separately

This is the distinction that catches careful operators, because passing one feels like passing.

• The method test is about tax. An accountable plan under 26 CFR 1.62-2 needs business connection, substantiation, and return of excess. A payment tied to recorded miles can satisfy it. A flat fee per delivery or a percentage of the ticket cannot, because neither is connected to a mile anyone recorded. Fail this one and the money is taxable wages, reported on the W-2, whether the amount was generous or not. Our accountable plan guide walks the three tests in operator language.
• The rate test is about wages. If reimbursement falls short of what operating the vehicle actually cost, the driver funded the difference. Where that shortfall pushes a tipped driver below the minimum wage, the gap is treated as a kickback to the employer, which is the mechanism behind most of the delivery cases now moving through the courts. The kickback theory explains it mechanically.

Paying generously with the wrong structure fails the first. Paying correctly with a rate set in 2019 fails the second. The calculator reports both because they are genuinely independent.

The standard mileage rate is not your cost, in either direction

The published rate is a national average built for tax administration, not a measurement of your market. It is the ceiling for what can be reimbursed tax-free without further substantiation, and it is a useful reference point, but treating it as the right number for a delivery driver in your ZIP code is a guess in both directions.

Notice that the calculator can return a bad result in two opposite directions. Paying under the modeled cost is the exposure case. Paying the full IRS rate of $0.76 when a delivery mile in your market costs closer to forty-five cents is the overspend case, and at the volumes a busy store runs it is not a small number. Both are reasons to know your own figure rather than borrow a national one. Parker v. Battle Creek Pizza (6th Cir. 2024) made the point directly, rejecting the assumption that paying the standard rate is automatically defensible; it binds employers in Michigan, Ohio, Kentucky and Tennessee and is persuasive elsewhere. Our page on why a tight radius costs more per mile covers the input that surprises people most.

What to do with the number

If the calculator put you below the band, the useful next step is not a bigger flat rate. It is a documented per-mile rate for each store's own market, paid on recorded miles, with the rate and the miles kept together as one record. That is what turns a defensible amount into a defensible file, and the file is what gets asked for. If you would rather check your current position first, the reimbursement compliance audit is ten questions and takes about two minutes.

If it put you above the band, the number in front of you is money leaving the business every week for no compliance benefit, because overpaying does not fix a structural problem and does not buy any extra protection.

RatesReady builds the rate. Documented per-mile figures for each store's own market, built from filed insurance data, real fuel prices and local fees, refreshed monthly, with the audit trail attached and the recorded miles behind every payment. From $49 per location per month. Bring the numbers you just put into the calculator and we will show you what your actual rates look like next to them: book a 15 minute demo.

This calculator is general information for restaurant operators and is not legal, tax, or accounting advice. Every dollar figure it produces is illustrative and modeled: fuel is the real regional average for the year selected, while insurance and vehicle values are held at current filed levels because historical filings are not in the model. It does not establish liability, calculate damages, or substitute for reviewing your own records with a qualified professional.