Personal Use of Company Car based on IRS Commuting Rule
If you drive a company vehicle, and your personal use of the vehicle is restricted to commuting, you can use this program to calculate the value of the personal use based on the IRS Commuting Rule. Certain conditions apply when choosing this program.
About this program
Use this program to determine the value of the personal use of a company car provided for commuting. Each one-way #commute trip will be expensed at a fixed rate of $1.50. The personal use will be the total of all #commute trips logged with this vehicle.
How to use this program
Select this program within Psngr app for your company car. You cannot use this program with a privately-owned vehicle. Before choosing this program, read the "Conditions" section and ensure that you meet all requirements.
How this program works
When you select this program within Psngr app:
▪︎ Trips are logged (automatically) and expensed using IRS standard mileage rates. Specifically, trips tagged as #commute are expensed at the flat rate of $1.50 per trip (i.e. one way: from home to work or from work back home). Trips tagged as #personal are expensed at the standard business rate, and trips tagged as #business have no expenses.
▪︎ Expenses cannot be logged for a vehicle using this program.
▪︎ Monthly and Annual reports are restricted to a single vehicle (i.e. the vehicle using this program) and include a summary calculation with breakdown of #commute, #personal and #business miles, as well as the list of trips logged during the report period.
Conditions
You can use the commuting rule if all the following requirements are met.
- The company vehicle is provided to the employee for use in your trade or business and, for bona fide non-compensatory business reasons, the employee is require to commute in the vehicle. You will be treated as if you had met this requirement if the vehicle is generally used each workday to carry at least three employees to and from work in an employer-sponsored commuting pool.
- Your employer has a written policy under which employees are not allowed to use the vehicle for personal purposes other than for commuting or de minimis personal use (such as a stop for a personal errand on the way between a business delivery and the employee's home). Personal use of a vehicle is all use that isn't for your trade or business.
- The employee doesn't use the vehicle for personal purposes other than commuting and de minimis personal use.
- If this vehicle is an automobile (any four-wheeled vehicle, such as a car, pickup truck, or van), the employee who uses it for commuting isn't a control employee.
Disclaimer
Psngr does not provide tax, legal or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors.
Source: IRS publication 15-B