Travel Mileage Increases (Again) Effective July 1

Tuesday, July 8, 2008 | 0

Mileage for workers' compensation travel has once again increased  for travel after July 1. This increase in based on the decision of the IRS to increase its allowance for mileage for business travel to 58.5¢ per  mile effective on that date. It is important to note this increase affects only mileage incurred after the effective date and not mileage incurred before but submitted after that date.

Mileage for workers' comp travel is set in Labor Code § 4600 at 34¢ per mile or  "the mileage rate adopted by the director of the Department of Personnel Administration pursuant to Section 19820 of the Government Code, whichever is higher, plus any bridge tolls."

Government Code § 19820 provides for regulations to be adopted for this purpose and the Department of Personnel Administration's Regulation is located at Title 2 Section 599.631, which also sets the standard at 34¢. However that regulation is now superseded by the memorandum of understanding with the state's employees' union that ties reimbursed mileage to the rate  
set by the Internal Revenue Service.

Got it?

All we need to know at this point is the IRS mileage, found here: http://www.irs.gov/newsroom/article/0,,id, is the rate to use. The rest is filler. IRS' message indicates that this increase is effective from July 1 to Dec. 31. The period is limited because the IRS is concerned about defining expenses for tax years, hence the Dec. 31 cut-off date; but it seems likely that if gasoline prices continue on their present course, another increase will be allowed effective Jan. 1. With a history of now three increases in the past two  years, additional increases are certainly not unlikely, so be on the lookout around the end of 2008 for the next rate jump.

<i>Richard M. Jacobsmeyer is a partner with the law firm of Shaw, Jacobsmeyer, Crain, Claffey & Nix, with offices in San Francisco, Oakland and Beverly Hills.</i>