diff --git a/src/components/ReportActionItem/MoneyRequestView.tsx b/src/components/ReportActionItem/MoneyRequestView.tsx
index ca50e93e536f..1c3a9336714f 100644
--- a/src/components/ReportActionItem/MoneyRequestView.tsx
+++ b/src/components/ReportActionItem/MoneyRequestView.tsx
@@ -390,7 +390,7 @@ function MoneyRequestView({report, shouldShowAnimatedBackground, readonly = fals
     const shouldShowReceiptAudit = isReceiptAllowed && (shouldShowReceiptEmptyState || hasReceipt);
 
     const errors = {
-        ...(transaction?.errorFields?.route ?? transaction?.errors),
+        ...(transaction?.errorFields?.route ?? transaction?.errorFields?.waypoints ?? transaction?.errors),
         ...parentReportAction?.errors,
     };
 
diff --git a/src/components/ReportActionItem/ReportActionItemImage.tsx b/src/components/ReportActionItem/ReportActionItemImage.tsx
index f999d12f054b..afb7df1e2218 100644
--- a/src/components/ReportActionItem/ReportActionItemImage.tsx
+++ b/src/components/ReportActionItem/ReportActionItemImage.tsx
@@ -91,7 +91,7 @@ function ReportActionItemImage({
     const {translate} = useLocalize();
     const isDistanceRequest = !!transaction && TransactionUtils.isDistanceRequest(transaction);
     const hasPendingWaypoints = transaction && TransactionUtils.isFetchingWaypointsFromServer(transaction);
-    const hasErrors = !isEmptyObject(transaction?.errors) || !isEmptyObject(transaction?.errorFields);
+    const hasErrors = !isEmptyObject(transaction?.errors) || !isEmptyObject(transaction?.errorFields?.route) || !isEmptyObject(transaction?.errorFields?.waypoints);
     const showMapAsImage = isDistanceRequest && (hasErrors || hasPendingWaypoints);
 
     if (showMapAsImage) {
diff --git a/src/libs/actions/IOU.ts b/src/libs/actions/IOU.ts
index 943a8883ac1f..40bf57ddadd6 100644
--- a/src/libs/actions/IOU.ts
+++ b/src/libs/actions/IOU.ts
@@ -3251,6 +3251,7 @@ type UpdateMoneyRequestDistanceParams = {
     policy?: OnyxEntry<OnyxTypes.Policy>;
     policyTagList?: OnyxEntry<OnyxTypes.PolicyTagLists>;
     policyCategories?: OnyxEntry<OnyxTypes.PolicyCategories>;
+    transactionBackup: OnyxEntry<OnyxTypes.Transaction>;
 };
 
 /** Updates the waypoints of a distance expense */
@@ -3262,6 +3263,7 @@ function updateMoneyRequestDistance({
     policy = {} as OnyxTypes.Policy,
     policyTagList = {},
     policyCategories = {},
+    transactionBackup,
 }: UpdateMoneyRequestDistanceParams) {
     const transactionChanges: TransactionChanges = {
         waypoints: sanitizeRecentWaypoints(waypoints),
@@ -3285,6 +3287,39 @@ function updateMoneyRequestDistance({
         value: recentServerValidatedWaypoints,
     });
 
+    if (transactionBackup) {
+        const transaction = allTransactions?.[`${ONYXKEYS.COLLECTION.TRANSACTION}${transactionID}`];
+
+        // We need to include all keys of the optimisticData's waypoints in the failureData for onyx merge to properly reset
+        // waypoint keys that do not exist in the failureData's waypoints. For instance, if the optimisticData waypoints had
+        // three keys and the failureData waypoint had only 2 keys then the third key that doesn't exist in the failureData
+        // waypoints should be explicitly reset otherwise onyx merge will leave it intact.
+        const allWaypointKeys = [...new Set([...Object.keys(transactionBackup.comment?.waypoints ?? {}), ...Object.keys(transaction?.comment?.waypoints ?? {})])];
+        const onyxWaypoints = allWaypointKeys.reduce((acc: NullishDeep<WaypointCollection>, key) => {
+            acc[key] = transactionBackup.comment?.waypoints?.[key] ? {...transactionBackup.comment?.waypoints?.[key]} : null;
+            return acc;
+        }, {});
+        const allModifiedWaypointsKeys = [...new Set([...Object.keys(waypoints ?? {}), ...Object.keys(transaction?.modifiedWaypoints ?? {})])];
+        const onyxModifiedWaypoints = allModifiedWaypointsKeys.reduce((acc: NullishDeep<WaypointCollection>, key) => {
+            acc[key] = transactionBackup.modifiedWaypoints?.[key] ? {...transactionBackup.modifiedWaypoints?.[key]} : null;
+            return acc;
+        }, {});
+        onyxData?.failureData?.push({
+            onyxMethod: Onyx.METHOD.MERGE,
+            key: `${ONYXKEYS.COLLECTION.TRANSACTION}${transactionID}`,
+            value: {
+                comment: {
+                    waypoints: onyxWaypoints,
+                    customUnit: {
+                        quantity: transactionBackup?.comment?.customUnit?.quantity,
+                    },
+                },
+                modifiedWaypoints: onyxModifiedWaypoints,
+                routes: null,
+            },
+        });
+    }
+
     API.write(WRITE_COMMANDS.UPDATE_MONEY_REQUEST_DISTANCE, params, onyxData);
 }
 
diff --git a/src/libs/actions/Transaction.ts b/src/libs/actions/Transaction.ts
index 3cb6e3dc44ba..c8a007458242 100644
--- a/src/libs/actions/Transaction.ts
+++ b/src/libs/actions/Transaction.ts
@@ -458,7 +458,7 @@ function abandonReviewDuplicateTransactions() {
 }
 
 function clearError(transactionID: string) {
-    Onyx.merge(`${ONYXKEYS.COLLECTION.TRANSACTION}${transactionID}`, {errors: null, errorFields: {route: null}});
+    Onyx.merge(`${ONYXKEYS.COLLECTION.TRANSACTION}${transactionID}`, {errors: null, errorFields: {route: null, waypoints: null, routes: null}});
 }
 
 function markAsCash(transactionID: string, transactionThreadReportID: string) {
diff --git a/src/pages/iou/request/step/IOURequestStepDistance.tsx b/src/pages/iou/request/step/IOURequestStepDistance.tsx
index efe5d293036b..dd02df8f4177 100644
--- a/src/pages/iou/request/step/IOURequestStepDistance.tsx
+++ b/src/pages/iou/request/step/IOURequestStepDistance.tsx
@@ -465,6 +465,7 @@ function IOURequestStepDistance({
                 waypoints,
                 ...(hasRouteChanged ? {routes: transaction?.routes} : {}),
                 policy,
+                transactionBackup,
             });
             navigateBack();
             return;
diff --git a/src/types/onyx/Transaction.ts b/src/types/onyx/Transaction.ts
index 547e41463c70..594503af78c3 100644
--- a/src/types/onyx/Transaction.ts
+++ b/src/types/onyx/Transaction.ts
@@ -338,7 +338,7 @@ type Transaction = OnyxCommon.OnyxValueWithOfflineFeedback<
         errors?: OnyxCommon.Errors | ReceiptErrors;
 
         /** Server side errors keyed by microtime */
-        errorFields?: OnyxCommon.ErrorFields<'route'>;
+        errorFields?: OnyxCommon.ErrorFields;
 
         /** The name of the file used for a receipt (formerly receiptFilename) */
         filename?: string;