<p>The Tax Cuts and Jobs Act put a lot more pressure on companies to reimburse their employees for work-related expenses, as these can no longer be written off by employees.</p>
<h2>Impact on Delivery Businesses</h2>
<p>Considering the mileage rate is ~$0.57/mile, this is significant.</p>
<p><strong>Example calculation:</strong></p>
<ul>
<li>Driver does 4 orders per hour, each producing $10 in revenue = $40 total</li>
<li>Cost to pay the driver: $15/hour</li>
<li>Each order is a round-trip of 7.5 miles</li>
<li>Mileage owed: 7.5 × 4 × $0.56 = $16.80 per hour</li>
<li><strong>Total hourly cost</strong>: $15 + $16.80 = $31.80 (not including workers comp or HNOA insurance)</li>
</ul>
<p>Slim margins!</p>
<h2>Key Point</h2>
<p>You cannot deduct your mileage if your employer reimburses you for mileage.</p>
<h2>References</h2>
<ol>
<li><a href="https://www.freshbooks.com/hub/taxes/what-claim-as-unreimbursed-employee-expenses">FreshBooks - Unreimbursed Employee Expenses</a></li>
<li><a href="https://www.irs.gov/newsroom/law-change-affects-moving-mileage-and-travel-expenses">IRS - Law Change Affects Moving, Mileage and Travel Expenses</a></li>
<li><a href="https://gigworker.com/irs-mileage-rate/">GigWorker - IRS Mileage Rate</a></li>
</ol>


How the Tax Cuts and Jobs Act affected employee expense deductions and what it means for delivery businesses.