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To: All pastors, parish mission administrators, school principals and business Managers
From: Michael Warren, Director of Financial Services, and Patrick Warner, Parish Accounting Manager; Office of Finance
STANDARD MILEAGE RATES: Effective January 1, 2021 the standard mileage rate in the archdiocese for business mileage will be 56¢ per mile. Please use this rate to reimburse employees who drive their personal vehicles for church/school related business. This rate is also used to compensate archdiocesan priests who have chosen the actual mileage method for their automobile reimbursement.
PRIEST AUTOMOBILE ALLOWANCE AND EXPENSE OPTIONS
AUTOMOBILE ALLOWANCE – Each priest is responsible for providing his own automobile. Priests may elect one of two methods to recover a portion of the cost of a single automobile:
80/20 Option: where 80 percent of all normal operating expenses including insurance, gas, oil, repairs, etc. are paid.
The most efficient way of handling the payment of auto expenses for those who elect the 80/20 option: the priest should pay the expenses, and then submit receipts to the business office. The business office will reimburse the priest for 80 percent of the expense (meaning the priest absorbs 20 percent of the expense). The priest would have the 80 percent reimbursement included on his 1099 for the year.
Per Mile Option: An amount per mile (56¢) is defined by the IRS, for mileage drive on church/school business. This reimbursement is processed via expense reports that include appropriate documentation.
ORDER PRIESTS – Order priests are provided automobiles by their order. The order is reimbursed though a fixed automobile allowance paid directly to the Order.
PARISH, SCHOOL OR CATHOLIC CENTER – The entity to which the priest is assigned is responsible for the automobile allowance (whether that is paid under the “per mile” option or the “80/20” option).
AUTOMOBILE OPERATING EXPENSES – For those who elect the 80/20 option for automobile reimbursement, these expenses do not include extraordinary replacements, such as a new engine or transmission. Personal auto mileage are not included in reimbursable mileage. Reimbursement does not include accident repair cost in excess of that covered by insurance.
FLEET AUTOMOBILE POLICY – Priests are encouraged to purchase automobile insurance through the archdiocesan fleet policy. The fleet policy is billed out in July for the entire policy year. If a priest declines the fleet policy and instead procures insurance coverage independently, then the outside coverage must include at least a $500,000 combined single limit of liability (or $1,000,000 if available), and the policy needs to specify that the archdiocese is an additional named insured party. Any vehicles covered by an outside policy must be made available for the Office of Finance and Catholic Mutual, as requested.