Fixed and Variable Rate (FAVR) Reimbursement
FAVR is an employee mileage reimbursement method that helps companies save money while providing accurate, tax-free reimbursements to employees.
TripLog offers FAVR for as little as $19/user/mo. See pricing
How FAVR can lower reimbursement costs
Cents-per-mile (CPM) reimbursement pays each driver one rate for every mile, determined via a national average of driving costs.
FAVR is an IRS program that takes those same driving costs and breaks them into a fixed-monthly payment and a variable per-mile rate, using vehicle and location-based cost data to make reimbursements more precise.
FAVR breakdown:
Fixed payment
Paid every month, regardless of miles driven.
Variable payment
Per-mile rate paid for miles driven for work.
See what FAVR could look like for your team
TripLog can help you evaluate your mileage program, identify which drivers may be a fit for FAVR, and get the right setup in place.
Multiple programs, one platform
FAVR or CPM? Most companies need both.
Most companies don't have one type of driver. Some employees drive occasionally, while others cover thousands of miles every month. Some teams use mid-sized sedans, while others need heavy-duty trucks.
TripLog helps you group drivers by mileage, role, location, and vehicle type, then assign the reimbursement program that fits each group best.
Program 1: CPM
Avg. 3,100 mi/yr
Program vehicle: Not applicable
Program 2: FAVR
Avg. 15,000 mi/yr
Program vehicle: Midsize sedan
Program 3: FAVR
Avg. 25,000 mi/yr
Program vehicle: Fullsize truck
Driver location | Cost of driving | Miles driven/mo | CPM payment | FAVR payment |
|---|---|---|---|---|
| New York, NY | High | 1,000 mi | $760Underpaid | $872Fair payment |
| Dallas, TX | Medium | 1,000 mi | $760Overpaid | $568Fair payment |
| Mobile, AL | Low | 1,000 mi | $760Overpaid | $463Fair payment |
Do we have to replace CPM to use FAVR?
No. You can use CPM and FAVR in the same TripLog account. Drivers who qualify for FAVR can use it, while others can remain on CPM. Your entire team can keep using the same app, the same admin dashboard, and the same reimbursement process.
Is FAVR difficult to manage?
With TripLog, not at all. Legacy FAVR providers make FAVR feel big and complicated to roll out, but it doesn’t have to be anymore. Our goal is to make FAVR feel as simple to run as CPM.
Is FAVR reimbursement tax-free?
In order for FAVR reimbursements to be tax-free, your program must meet IRS requirements, including accurate mileage tracking and documentation, use of a qualified FAVR program, and ongoing compliance checks.
TripLog structures your FAVR program the right way from the beginning, so your team can receive tax-free reimbursements without you having to manage all the complexity.
How are FAVR reimbursement rates calculated?
FAVR rates are based on the real costs of owning and operating a vehicle. Rates can vary based on things like geography, program vehicle type, expected mileage, and vehicle retention cycle.
What costs are included in a FAVR reimbursement rate?
FAVR combines a monthly or semi-monthly payment for fixed ownership costs that aren’t tied to miles driven with a per-mile rate for variable costs that do scale with miles driven.
Can we use our existing payroll provider?
Yes. TripLog can connect with payroll providers like ADP and Concur, so you can keep your current payroll process and send reimbursement data from TripLog into that system.
- How do I actually pay/reimburse my drivers?
Drivers submit their mileage through the TripLog app, managers approve it, and the approved reimbursement amounts can be sent to your payroll provider or managed directly within TripLog.
- Can our company manage a FAVR program ourselves?
Technically yes, though very difficult in practice. FAVR requires defensible vehicle cost data, location-based rate calculations, accurate mileage tracking, and ongoing program management.
TripLog uses trusted data sources for the vehicle cost FAVR rates require, then helps turn those inputs into accurate fixed and variable reimbursement rates. Instead of trying to collect the data, build the calculations, ensure accurate mileage tracking, and manage the program manually, TripLog is designed to handle the heavy lifting.
Ready to build the right
reimbursement program?
Whether your team needs CPM, FAVR, or a mix of both, you can trust the mileage experts at TripLog help you get started.