The free use of a company car is one of the best perks an employee may receive as part of a compensation package. But the benefit to the employee isn’t completely “free” under current tax law. Essentially, personal use of a company car is treated as a taxable noncash fringe benefit, subject to income tax obligations.
The IRS just announced a key valuation amount for 2019.
The maximum value of an employer-provided vehicle (including cars, vans and trucks) first made available to employees for personal use in calendar year 2019 for which either the vehicle cents-per-mile valuation rule or fleet-average valuation rule may be used is $50,400. (IRS Notice 2019-34)