I just finished my first complete fiscal year with a fleet vehicle and I rarely use it outside of work. I work in the field but live 30 miles or so from where I work. So, I'm eating 60 miles a day that are being allocated as personal miles which is all pouring into a taxable benefit. I'm putting 1200 miles a month on the vehicle back and forth to work and maybe 150 or 200 miles a month that is truly personal. Also, I pay a $150/month personal use withhold.

Is there any way I can make any of this up on the back side at filing time?

All I'm using it for is work, I pay a personal use payroll withhold and come the end of the year I have to pay through the nose for the taxable benefit.

Any advice would be greatly appreciated. TIA.

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Posted by JDCPA76

Member since Jul 2015

73 posts

Posted on 11/5/15 at 8:56 am to Scoop

Are you saying that you are charged monthly in your salary for the personal use and at the end of the year you are charged for personal use on your corporate return? I assume S Corp.

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Posted by LSUFanHouston

NOLA

Member since Jul 2009

36924 posts

Posted on 11/5/15 at 9:33 am to Scoop

At the current mileage rate, you are currently paying for (via withholding) 260.87 miles a month. Commuting miles are not the same as business miles. So if you are communting 60 miles a day, that's 300 miles a 5 day week, 1200 miles a 4-week month. Add that 1200 miles to the 200 miles a month that you say are truly personal, and that gives you 1400 miles a month. You are "paying" for 261 miles, so you should be taxed on the mileage value of 1,139 miles a month. At 57.5 cents a mile that's $655/month in "benefit" that is absolutely taxable to you.

In exchange, you don't have to use your personal vehicle wear, tear, gas, maintenance, etc, to drive to work in back.

Your "cost" is the tax cost of this $655/month, which I'm guessing is a lot cheaper than the wear and tear, maintenance, gas, etc, if you used your personal car to commute 300 miles a week.

You are getting a good deal here. Don't be greedy. =)

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Posted by Scoop

RIP Scoop

Member since Sep 2005

44583 posts

Posted on 11/5/15 at 7:32 pm to LSUFanHouston

Thank you for your input. Very helpful. The car was optional and my direct out of pocket in the fiscal year is $2800 via witholds and taxes. With no maintenance costs and having a gas card I was just trying to do the math after the first year.

There are intangibles such as getting a new care every year which I am about to and I gave up mileage reimbursement taking the car. It is pretty confusing trying to figure out if you are coming out ahead.

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