California employers must reimburse employees for all necessary work-related expenses, including the use of an employee’s personal vehicle for business purposes. One of the simplest ways to comply with California’s reimbursement requirements is to use the IRS standard mileage reimbursement rate.

Effective July 1, 2026, the IRS announced a rare mid-year increase to the standard business mileage reimbursement rate. Employers should ensure they are reimbursing employees using the updated rate for business travel occurring on or after July 1. Doing so helps reduce the risk of claims that employees were not fully reimbursed for work-related vehicle expenses.

For the period July 1 through December 31, 2026, the IRS standard mileage rate for cars, vans, pickups, and panel trucks is:

• 76 cents per mile for business use (up from 72.5 cents).

Employers should update their reimbursement policies, payroll systems, and expense reporting procedures to reflect the new rate for business mileage beginning July 1.

If you have any questions regarding the new IRS rates or other issues related to your company’s employment concerns, please contact our employment attorney Scott Liner at [email protected].

Have questions about mileage reimbursement or employee expense obligations?
Contact employment attorney Scott Liner at Chase Law Group.

WWW.CHASELAWMB.COM
310-545-7700

_{Please note that this article is for informational purposes only and should not be considered legal advice and does constitute an attorney-client relationship. It is recommended to consult with an attorney directly for specific guidance pertaining to your business and its practices.}