Did you know that reimbursing your nanny for the mileage they drive for work is considered a standard nanny benefit? Mileage is to be reimbursed when the nanny uses his/her personal vehicle for work. The reimbursement rate for 2022 is 58.5 cents per mile, up from 56 cents in 2021.
Nannies should be reimbursed for miles driven for work, with the exception of miles driven to and from work each day. He/she should take care to track miles driven for work- including errands ran for the family, school pickups, carpooling to playdates, and field trips with the children.
You can also choose to pay a flat rate reimbursement if tracking miles driven is too involved. Or you can pay per job if your nanny doesn’t drive your children around often. Some families offer a credit card for gas expenses though that doesn’t take into account wear and tear on a vehicle.
Reimbursement payouts can be paid with the nanny’s paycheck, or paid monthly/quartlery. The reimbursements are not taxable income, unless paid at more than the IRS rate. Here is a helpful article from GTM on nanny mileage reimbursement.