In Nebraska, where the economy spans from bustling city centers to vital agricultural regions, travel is often a key component of business.
Understanding the guidelines for mileage reimbursement is therefore essential for both employers seeking to manage expenses fairly and employees using personal vehicles for work-related duties across Nebraska.
The national standard often looked to for these calculations is the rate published by the Internal Revenue Service (IRS).
For the year 2025, the IRS has established the standard mileage rate for business use of a personal vehicle at 70 cents per mile. This reflects an increase from the 67 cents per mile rate that was in effect for 2024.
Private employers in Nebraska are not explicitly mandated by a specific state statute to use this IRS rate for all general business travel. However, aligning with this federal benchmark is a common practice due to its recognized benefits:
- It offers a clear, consistent, and widely accepted basis for reimbursement calculations, simplifying company policy.
- When payments are made through an accountable plan at or below this IRS rate, they are generally not considered taxable income for the employee and are deductible as a business expense for the employer.
As of January 1, 2025, the key IRS standard mileage rates are:
- 70 cents per mile for business use of a vehicle.
- 21 cents per mile for medical or moving purposes (note: the deduction for moving expenses is currently limited to active-duty members of the U.S. Armed Forces).
- 14 cents per mile driven in service of charitable organizations.
Other relevant rates in Nebraska include:
- Nebraska State Employee Rate: The State of Nebraska, as per Nebraska Revised Statute § 81-1176, reimburses its employees for mileage incurred in performing official duties using their private vehicles at a rate set by the Director of Administrative Services, which is reviewed in conjunction with IRS rate changes. Effective January 1, 2025, this rate is 70 cents per mile (it was 67 cents per mile in 2024).
- Workers' Compensation Medical Travel: Injured employees in Nebraska are entitled to reimbursement for reasonable travel expenses, including mileage, to obtain necessary medical services for work-related injuries (Nebraska Revised Statute § 48-120). The mileage rate for this purpose is the same as that set for state employees, meaning it is 70 cents per mile for 2025.
For historical context, here are the IRS standard business mileage rates from recent years:
Nebraska Mileage Reimbursement Calculator
Efficiently determine your potential mileage reimbursement with our Nebraska Mileage Reimbursement Calculator.
How to Use the Calculator:
- Select the correct tax year: Choose the year for your calculation (e.g., 2025, 2024), as IRS rates are updated annually.
- Input your business miles: Enter the total miles driven for business purposes using your personal vehicle.
- Calculate your reimbursement: The calculator will apply the official IRS standard mileage rate for the chosen year to provide your estimated reimbursement.
This tool provides a straightforward estimate based on federal standards, beneficial for managing travel expenses in Nebraska.
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Some Important Nebraska Mileage Reimbursement Laws
While Nebraska does not have a specific law requiring all private employers to reimburse for business mileage at a set rate, several state laws and overarching federal regulations play a crucial role:
1. Nebraska Wage and Hour Act (Nebraska Revised Statute § 48-1203)
Nebraska's minimum wage is $13.50 per hour as of January 1, 2025, with scheduled increases to $15.00 in 2026. This is a critical baseline.
Employers must ensure that any unreimbursed work-related expenses, such as mileage, do not effectively reduce an employee's pay below this state minimum for the hours worked.
For tipped employees, a cash wage of at least $2.13 per hour must be paid, with tips covering the difference up to the full minimum wage.
2. Workers' Compensation (Nebraska Revised Statute § 48-120)
State law mandates that employers are liable for reasonable medical services for work-related injuries, which includes the reimbursement of necessary travel expenses to obtain such care. The mileage rate for this travel is linked to the state employee rate (70 cents per mile for 2025).
3. Absence of General Private Employer Reimbursement Mandate
Outside the context of ensuring minimum wage compliance and fulfilling workers' compensation obligations, Nebraska law does not generally compel private employers to reimburse for mileage. Thus, specific company policies often govern these practices.
4. State Employee Travel Regulations (Nebraska Revised Statute § 81-1176)
Nebraska has clear statutes for reimbursing state employees for official travel in personal vehicles, with the rate directly tied to the IRS standard rate. This establishes a precedent for fair reimbursement within the state's public sector.
Nebraska Mileage Reimbursement Law vs. Federal Law
In Nebraska, the legal considerations for mileage reimbursement are shaped by the state's own escalating minimum wage and its public sector practices, all operating under the umbrella of federal law and IRS guidelines.
Fair Labor Standards Act (FLSA)
The FLSA is the principal federal law governing wage and hour standards, including the federal minimum wage (currently $7.25 per hour).
A key tenet is that an employee's wages must not effectively fall below this federal minimum due to unreimbursed business expenses that primarily benefit the employer, such as mileage costs.
If such expenses were to erode an employee's pay to below this federal floor, the employer would need to provide sufficient reimbursement.
Nebraska's State Laws
Nebraska's legal landscape presents distinct considerations that often take precedence due to being more favorable to employees:
- The state's minimum wage ($13.50 per hour in 2025 and $15.00 in 2026) is significantly above the federal rate. This means Nebraska employers must primarily ensure that unreimbursed driving expenses do not violate this higher state minimum wage.
- Nebraska law explicitly links its state employee mileage reimbursement and, consequently, its workers' compensation medical travel rates to the current IRS standard rate. This direct adoption of the IRS rate for official state purposes underscores its relevance and acceptance within Nebraska.
IRS Regulations
The standard mileage rates issued by the IRS (e.g., 70 cents per mile for business in 2025) are primarily established for federal income tax purposes. They are not laws that legally require employers to reimburse at that specific amount.
However, their practical impact is substantial. If a Nebraska employer utilizes an accountable plan and reimburses at or below these IRS rates, the reimbursement is generally non-taxable income for the employee and a deductible expense for the business.
Given that Nebraska's official state travel rate aligns with the IRS rate, this federal standard is particularly influential.
In summary, for Nebraska employers, the state's own rising minimum wage is the primary threshold that must be protected from being undercut by business expenses. Federal law (FLSA) provides a national wage baseline, but state law is often more protective.
Furthermore, Nebraska's direct alignment of public sector and workers' compensation mileage rates with the IRS standard rate solidifies the IRS figures as a strong benchmark for reasonable and tax-efficient reimbursement practices across the state.
How Fyle can automate mileage tracking
Take the complexity out of mileage reimbursement in Nebraska with Fyle's expense and mileage tracking software. Our platform offers businesses an efficient way to manage travel expenses, ensuring accuracy and saving valuable time.
- GPS-enabled mileage logs for precision: Automatically captures travel distances using Google Maps, ensuring every trip is accurately recorded without manual input.
- Flexible rate application for compliance: Easily supports IRS standards, Nebraska's state-aligned rates, or your unique company figures, applied instantly to claims.
- Clear commute distinction: Defines home and work locations to help accurately identify and deduct non-reimbursable personal commute travel.
- Automated recurring journey setup: Allows employees with frequent, similar routes to set them up once, streamlining future mileage claim submissions.
- Built-in policy and compliance validation: Embeds your company's expense rules to proactively flag any claims that deviate from established guidelines or limits.
- Seamless integration with accounting systems: Connects directly with popular software like QuickBooks, Xero, Sage, and NetSuite, for effortless data synchronization and reduced manual work.
- Reimbursements via ACH (US only): Offers fast and direct ACH payment for approved mileage claims, enhancing employee satisfaction and cash flow.
Fyle helps Nebraska businesses streamline their mileage tracking, improve compliance, and provide a better, more efficient experience for their teams.
