Indiana's private employers may choose between reimbursing mileage at rates established by the state's Department of Administration or adopting the IRS standard mileage rates detailed below. The federal benchmarks offer a nationally recognized alternative that many businesses prefer for streamlined accounting procedures.

Note: Organizations have flexibility to reimburse employees at rates that differ from the IRS standard. However, any reimbursement exceeding the IRS rate will be classified as taxable income to the employee.

To calculate applicable mileage reimbursement for Indiana, do the following:

1. Select the appropriate tax year for your calculation period
2. Enter the total miles driven to compute eligible reimbursement amounts

The calculator below provides precise reimbursement figures based on current rates and specified mileage inputs.

Indiana employers face a regulatory framework that demands vigilant compliance with mileage reimbursement statutes designed to ensure equitable compensation for work-related travel expenses. The state's labor code provisions, particularly section 22-3-3-6, establish specific parameters governing when and how businesses must provide such reimbursements to their workforce.

These legal requirements, which will be examined in greater detail in subsequent analysis, represent a significant component of Indiana's broader employee compensation regulations that savvy financial officers increasingly recognize as essential to both operational compliance and talent retention strategies.

Workers compensation code for mileage reimbursement

Indiana's Mileage Reimbursement Code 22-3-3-6 represents a significant financial obligation for employers under the state's workers' compensation framework. The statute, applicable across both government and corporate sectors, establishes clear compensation requirements: employers must provide mileage reimbursement when employees travel for medical evaluations or treatments stemming from workplace injuries.

The reimbursement rate aligns with the Indiana Department of Administration's standard—set at $0.49 per business mile for 2024—ensuring parity with compensation provided to state employees.

Notably, the Workers' Compensation Board's enforcement of §22-3-3-6 extends to scenarios where employees must cross county lines for medical care, creating a comprehensive financial protection mechanism regardless of treatment location.

Indiana minimum wage by the law

Indiana adheres to the federal minimum wage benchmark established by the Fair Labor Standards Act (FLSA), maintaining the $7.25 hourly rate.

While the state does not legislate a distinct minimum for mileage compensation, employers face a critical financial consideration: when travel-related expenditures effectively reduce an employee's earnings below the mandated minimum wage threshold, companies must provide supplemental compensation to bridge this gap. This provision serves as a financial safeguard, ensuring that employees' net compensation accurately reflects both their labor contribution and the economic burden of work-related travel.

Indiana vs federal mileage reimbursement laws

Federal IRS guidelines establish a standard mileage reimbursement benchmark, yet Indiana's regulatory framework—particularly Code 22-3-3-6—imposes more nuanced financial obligations on employers in scenarios that federal statutes leave unaddressed.

The state's provisions notably extend beyond federal requirements by mandating comprehensive coverage of travel expenditures, including mileage, for medical treatment under workers' compensation claims. This represents a more expansive financial responsibility than the federal government's more generalized approach. For employers, compliance transcends mere regulatory adherence; it constitutes a more robust financial support structure for their workforce, with corresponding implications for corporate expense management and employee compensation strategies.

Effective employee mileage reimbursement in Indiana requires both regulatory knowledge and practical implementation methods. Businesses that excel in this area ensure compliance while creating more efficient operations and improving employee satisfaction.

Create a clear mileage reimbursement policy

Develop a detailed written policy that specifies eligible travel, documentation requirements, submission deadlines, and chosen reimbursement rates. Clearly indicate whether your company follows Indiana Department of Administration rates or federal IRS rates. This transparency helps prevent confusion and disputes with employees.

Implement digital mileage tracking tools

Consider adopting GPS-enabled mileage tracking apps that automatically record business trips. These technologies create accurate logs while minimizing administrative burden on employees. Many solutions can integrate directly with expense management software for seamless processing.

Document workers' compensation mileage separately

Since Indiana Code 22-3-3-6 specifically addresses workers' compensation travel reimbursement, maintain separate tracking for these expenses. Create specific expense categories and documentation procedures for trips related to workplace injury treatment to ensure proper compliance.

Understand tax implications for different reimbursement methods

Recognize how your chosen reimbursement approach affects both company finances and employee tax obligations. If you exceed IRS rates, ensure your accounting system properly codes the excess as taxable income and that employees understand these distinctions.

Consider implementing a standard mileage allowance

For employees with predictable travel patterns, consider establishing fixed monthly allowances based on historical mileage data. This approach can reduce administrative costs while providing employees with consistent reimbursement they can count on.

Audit reimbursement claims regularly

Conduct periodic reviews of mileage claims to identify unusual patterns or potential errors. These audits help maintain program integrity while ensuring legitimate business travel receives prompt compensation according to your established policies.

Stay current with rate changes

Both Indiana Department of Administration rates and IRS rates change periodically. Assign responsibility for monitoring these changes to ensure your reimbursement amounts remain current. Consider programming automatic updates into your expense management platform when rates change.

As Indiana businesses consider their approach to employee compensation, mileage reimbursement stands as a critical financial consideration with implications for regulatory compliance, talent retention and corporate governance. The state's dual system—maintaining its own reimbursement framework while acknowledging federal IRS standards—creates practical flexibility that employers can leverage to their advantage in an increasingly competitive labor market.

For businesses of all sizes, the stakes extend past simple regulatory adherence. In an era of rising operational costs and worker mobility, comprehensive travel expense policies signal an organization's commitment to equitable compensation practices, safeguarding against potential wage-related litigation while reinforcing corporate values at a time when employees factor workplace policies into their employment decisions.

Brex's expense management software offers a compelling solution for companies seeking to streamline this process. The platform automates expense reimbursement workflows, allowing businesses to set customized spend limits tailored to different roles and departments. With intuitive tools for establishing and enforcing expense policies, Brex eliminates manual processing while ensuring consistent application of company standards. The software seamlessly integrates with existing accounting software and corporate card programs, automatically categorizing expenses and generating detailed reports that simplify tax preparation and financial planning. Companies that implement Brex report significant time savings, reduced processing errors, and improved employee satisfaction—making it an essential tool for organizations serious about optimizing their expense management processes. Sign up for Brex today.