S-Corp Locum Mileage: Do I Invoice the Corp or Just Deduct It?
Driving 200 miles twice a week to an assignment adds up to real money. Whether any of it is deductible, and the only correct way to route it through an S-corp, are two separate questions.
A guide by Taxstra Tax & Accounting · CPA-led tax strategy for business owners
Written by Bryan Martin, CPA, Managing Partner and Founder of Taxstra. Last updated August 18, 2026.
The short answer
Once you run locum income through an S-corp, you are its employee, and employees do not take Schedule C deductions. The correct plumbing is an accountable plan: submit a dated mileage log, the corporation reimburses you at the IRS rate (72.5 cents per mile for the first half of 2026, 76 cents after the July adjustment), the corp deducts it, you receive it tax-free. Deduct-it-myself is not an option that exists anymore, and unreimbursed shareholder expenses generally just die. Separately: whether those 200-mile runs are deductible at all depends on the temporary work location rules, not on your entity.
Question 1: are the miles deductible at all?
Entity aside, mileage lives on a cliff edge. Commuting between home and a regular work location is personal, never deductible, no matter the distance; plenty of physicians drive an hour each way to a permanent job and deduct nothing. The locum-relevant exception: travel between home and a temporary work location, generally one expected to last a year or less, is deductible business travel when the location is outside the metro area where you live and work, or when you also have a regular work location elsewhere.
So the 200-miles-twice-a-week pattern sorts like this. A 13-week assignment three counties away while you maintain your practice base at home: those are business miles. The same drive to a facility where you have renewed for the third year running: that location stopped being temporary, the drive became a commute, and the deduction ended the moment the one-year expectation broke. The same tax-home logic that governs housing stipends governs your wheels.
Question 2: the only correct S-corp routing
Sole proprietors deduct business mileage on Schedule C and move on. Elect S-corp status and that lane closes: the business is now a separate employer, you are its W-2 employee, and unreimbursed employee expenses are generally nondeductible on your 1040. Locums discover this a year late constantly, thousands of business miles driven, zero tax benefit captured, because nobody built the reimbursement layer.
The accountable plan is that layer, and it is gloriously boring:
- Adopt a short written reimbursement plan in the corporate records (once).
- Keep a dated log: date, destination, business purpose, miles. Apps or a spreadsheet both work; contemporaneous beats reconstructed.
- Submit it to the corporation monthly or quarterly; reasonable timeliness is a plan requirement, not a suggestion.
- Corp pays you at the standard rate, deducts the payment, issues no 1099 or W-2 income for it. Tax-free in your pocket, deductible to the entity.
And do not stop at mileage: the same plan should reimburse your home office (where it genuinely qualifies), phone and internet business share, licenses, CME, and qualifying travel, the whole expense stack from the side-gig setup guide, routed properly for an S-corp owner.
200 miles round trip, twice a week, 40 working weeks (2026)
- Business miles (assuming the location genuinely qualifies as temporary)
- 16,000 miles
- Jan-Jun miles reimbursed at 72.5 cents (8,000 mi)
- $5,800
- Jul-Dec miles reimbursed at 76 cents (8,000 mi)
- $6,080
- Total tax-free reimbursement to you, deductible to the corp
- $11,880
- Approximate tax value at a 37% federal + state marginal picture
- roughly $4,400
Nearly $12,000 moved out of the corporation untaxed, for the price of a mileage log and a template plan. Run the same year with no accountable plan and the number captured is typically zero. Illustrative; the temporary-location question decides whether these miles qualify at all.
Do not invoice the corp like a vendor
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Frequently Asked Questions
How do I deduct mileage if my locum work runs through an S-corp?
Through an accountable plan: you submit a mileage log to your corporation, the corporation reimburses you at the IRS standard rate, deducts the reimbursement, and you receive it tax-free. Unreimbursed business expenses of an S-corp shareholder-employee are generally not deductible on your personal return, so if you skip the reimbursement, the deduction usually just evaporates.
What is the IRS mileage rate for 2026?
For 2026 the business rate is split: 72.5 cents per mile for January through June, and 76 cents per mile for July through December after a mid-year adjustment. Use the rate matching when the miles were driven, which is one more reason the log needs dates, not annual totals.
Is driving from home to my locum assignment deductible mileage at all?
Commuting to a regular work location is never deductible, entity or not. Driving from home to a temporary work location outside your metropolitan area generally is, and travel between two work locations in the same day is. A recurring long-distance drive to the same facility lives exactly on this line, and the answer turns on whether the assignment is genuinely temporary (expected to last a year or less) and where your tax home sits.
Can the S-corp just pay for or own the car instead?
It can, but then personal use of a company vehicle becomes taxable wage income to you, tracked and added to your W-2, and the corporation depreciates actual costs rather than paying the standard rate. For a physician driving a personal vehicle a few thousand business miles, the accountable-plan mileage reimbursement is almost always simpler and cleaner.
What does a compliant accountable plan look like?
A short written plan adopted by the corporation, expenses with a business connection, substantiation submitted within a reasonable time (a dated mileage log with destinations and purpose), and any excess advances returned. Template plan, monthly log submission, reimbursement in the same payroll cycle. It is an afternoon of setup that converts personal outlays into clean corporate deductions.
Standard mileage rate or actual expenses through the corporation?
For a personally owned vehicle reimbursed through an accountable plan, the standard rate is the clean default: one number, no receipts beyond the log, no depreciation schedule on your car. Actual-expense reimbursement is possible but drags business-use percentages and vehicle records into the corporate books. Unless the vehicle is unusually expensive to run and heavily business-used, the standard rate wins on defensibility per hour of effort.
Can the corporation reimburse miles from last year that I never submitted?
The accountable plan rules require substantiation within a reasonable period, commonly implemented as 60 days from when the expense is incurred. A December submission of January’s miles strains that; a new plan cannot launder years of old commuting either. Treat reimbursement as a same-quarter discipline, and treat genuinely missed prior-year miles as a lesson rather than a project.
Does the reimbursement show up on my W-2 or K-1 anywhere?
Properly run accountable-plan reimbursements appear nowhere on your personal tax documents: not in W-2 wages, not on the K-1, not as income at all. That invisibility IS the benefit, and it is also the diagnostic: if your reimbursements are landing in box 1 of the W-2, the plan is being administered as non-accountable and the entire tax advantage is being forfeited in the payroll software settings.
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This page is educational, not individualized tax advice. Locum tenens tax outcomes depend on your contracts, your states, and your numbers. Savings vary by client and results are not typical of every situation. Consult a qualified tax professional before acting on anything here.