Whats the value of a company vehicle?

[URY914]

I accepted a job today and I get a company truck to take home. Never had this perk before. I don't know all the details yet, like if I can use it on the weekends and such. The truck is a F-150 which is a few years newer than my own truck.

So what is this worth in $$$ to me? I'll keep my truck for now which has two more years to pay off. I know it is a tough question and one without a real answer but I'm just trying to ballpark a number.

I'm thinking if I let my kid use my truck for driving to high school I just saved about $8k because that is what I would have spent on a car.

What are the tax rules for company trucks?

Thanks

[chocolatelab]

You will most likely be able to use it for private use but they may ask you to report those miles. The company will have a value associated to personal miles and you may pay taxes for that. What their value is I have no idea.

But having a company car is amazing. No maintenance costs, hopefully no gas, and whatever you are currently paying for your truck and insurance. Plus you aren't depreciating and racking up miles on your own car.

If they are pretty liberal with their truck and it suites your needs I would sell your current vehicle and enjoy.

I think its at least worth 20k to you.

[vash]

isnt it .51 cents per mile?

[ShakinJoe]

Paul,

It is worth a min of $7500. Probably closer to $10k.

What's the new job?

[KarlCarrera]

I had one for 9 years, but, could only use it for company related business. I figured it at about 3500-4K/yr. But....your company may offer greater flexibility. (Most do) Doubling this number would be pretty easy.

The good news is I figure I saved about 75-80K miles on my personal vehicle over that time.

Karl
88 Targa

[Hugh R]

$0.51/mile is what the IRS allows for personal mileage, so that is probably a good estimate. I don't think personal mileage get tracked much, but your employer may. Oh, and you "accepted" not "excepted" a job.

[URY914]

Hugh, right you are.

[Buckterrier]

Hey Paul, I've had a Co. car for 26 years. The rules/laws have changed over those years. What is it worth? A lot depends on what all is included. In my case it is all inclusive @ gas, maintenance, insurance. In that case Joe is correct. 8-10K annually. My Co. does track personal milage and we have to give an estimate at the beginning of the calendar year. I have approx. $100.00 a month taken from my salary, (small price to pay). I'm not sure about the taxes, but I believe it is taxed somehow. Also check on who can drive the car. Used to be with me anyone I gave permission to could drive it. Now only a spouse can. And their driving record can be reviewed first. The Co. I work for is self-insured so things have gotten tighter.
Congrats on the new job.

[widgeon13]

For tax purposes or for the personal value. I had a company car for 30 years, got a new one every 60,000 miles or every two years. Had some pretty nice cars over the years, Volvo 85 Turbo, BMW M3, Audi A6 Avant. I used to figure it was whatever I saved in not having to pay all those expenses out of my pocket. On an annual basis it usually figured out to be about 10K per year. For tax purposes, it was the personal miles driven in the car at a certain mileage rate added to my w-2. Can't beat a company car.

[Shadetree930]

Originally Posted by widgeon13

Can't beat a company car.

It is an excellent perk if your company's rules are loose enough. When you figure the cost to acquire, insure, maintain, fuel, wash, etc ..... it adds up. Depending on the purchase value of the vehicle, the refresh rate and the amount of personal use, 10,000 to 12,500 is a good starting number.

Understand that if that money were coming out of your pocket, it is after-tax money. So ... add in your tax factor to whatever value you assign to determine the salary equivalency.

[Macroni]

7500 to 10,000/yr

[asphaltgambler]

.....hopefully they won't 1099 you for that value.

[DaveE]

I worked for a GM division (not car-related) til we were sold off in 2005. I got a new Blazer every 25,000 miles. Their rule was at least 50% business miles. I put on 160 business miles every day so was free to drive personal miles pretty much all I wanted.

[porsche4life]

I'm curious about this as well. Company car is one of the perks of my internship. I'm hoping the taxes on that dont kill my pay though.

[gprsh924]

Considering the alternative would be racking up tons of miles on your own car, I'm pretty sure you will come out ahead.

[Scott R]

Clearly it differs greatly company to company as I read this. I get a new car every 12 months, we have normally four choices and we just pick. I do not have a cap on personal miles, nor do I have to report it. All fuel, insurance, maint, parking etc is covered. Any authorized driver that I allow can drive the car.

(just got my new one on Saturday actually dropped of my Rover for the BMW)

[widgeon13]

Originally Posted by Scott R

Clearly it differs greatly company to company as I read this. I get a new car every 12 months, we have normally four choices and we just pick. I do not have a cap on personal miles, nor do I have to report it. All fuel, insurance, maint, parking etc is covered. Any authorized driver that I allow can drive the car.

(just got my new one on Saturday actually dropped of my Rover for the BMW)

So if I understand you correctly, the value of personal use is not added to your w2. That is a real bonus but the IRS would love to catch up with you and your company on that. Hope your good fortune continues.

[URY914]

So if I don't drive it on the weekends there would be no personel use. Therefore no IRS/tax issue correct?

[Scott R]

Originally Posted by widgeon13

So if I understand you correctly, the value of personal use is not added to your w2. That is a real bonus but the IRS would love to catch up with you and your company on that. Hope your good fortune continues.

I'm an exempt employee and I don't draw an actual salary per say. Every hour of every day is "work" for me.

[azasadny]

When I was in mgmt at Ford, we had "mgmt lease cars" that cost us between $200 and $800 a month and we could use them for personal use, no mileage restrictions, family members could drive them and Ford paid for all maintenance but the maintenance was done at the Ford corporate garage. The only thing I paid, besides the greatly reduced monthly lease payment, was gasoline. We got a new car every year. Incredibly nice benefit, to say the least!