Using a Company-Owned Car

Blog content provided by Barbara Weltman, Publisher of Big Ideas for Small Business ®

If your corporation owns the vehicle that you or employees use for both business and personal driving, be sure to figure the “compensation” resulting from personal use of the vehicle.

The IRS has provided several fringe benefit valuation rules for figuring the value of the personal use of the company car. If you use your own vehicle for business driving, the business can reimburse you for this expense.

Relying on an IRS-set standard mileage rate (55 cents per mile in 2009) for making reimbursements for business driving can simplify recordkeeping. Using an accountable plan can avoid the need to include the reimbursements in your income.

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