If your company reimburses you (or your employees) for business mileage, read this carefully.

Most contractors assume:

“I get reimbursed for mileage, so the vehicle is personal and done.”

❌ That assumption is wrong.

Here’s the surprise most contractors miss 👇

When you’re reimbursed using the IRS standard mileage rate, the IRS treats that vehicle as a business asset, not a personal one. Why?

Because the mileage rate includes built-in depreciation.

📉 Over time, that “deemed depreciation” reduces your truck’s tax basis.

So when you eventually:• Sell it• Trade it in• Upgrade the fleet

• You may have a taxable gain — or a fully deductible ordinary loss (yes, ordinary, not capital).

In many cases, contractors are leaving five-figure deductions on the table simply because no one tells them to report the vehicle sale on Form 4797.

⚠️ This applies even if:✔️ You were fully reimbursed✔️ Reimbursements were tax-free✔️ You thought “there’s nothing left to report”

TLDR:Mileage reimbursement doesn’t end the tax story — it starts one most contractors never finish.

👷‍♂️ Smart tax planning beats working harder every time. Book a time: https://accountingsolutionsllp.com/appointment/