2006 Mileage Reimbursement Rate


The IRS announced that effective January 1, 2006, the standard mileage reimbursement rate will be reduced to 44.5 cents per mile, down from the temporary rate of 48.5 cents that has been in effect since September 1 2005.

Nannies and household staff who are required to use their personal vehicle for work purposes are entitled to mileage reimbursement. HomeWork Solutions recommends that language in the work agreement between the family and employee peg the reimbursement rate to the IRS rate to allow for periodic adjustments. We all know how much more expensive gas and automobile maintenance have become in the last few years. The employee is entitled to reasonable reimbursement for her out of pocket expense as well as maintenance and depreciation.

Employees are NOT entitled to reimbursement for mileage between their home and their employer's residence. However, if the employee drives children to/from school or camp, does routine grocery shopping or errands, or has other required business use of her personal vehicle, this is reimbursable.

Families who use their employee's vehicle to transport their children should pay careful attention to:

• The mechanical condition of the vehicle being used.


• The installation of child safety seats.


• Condition of tires.

The family may consider paying for a periodic safety inspection of the vehicle if not otherwise required by state law.