W-2 Reporting of the Personal Use of Business Vehicles

by | Nov 28, 2023 | Deadlines | 0 comments

If a business owns or leases vehicles that shareholders or employees use for personal reasons (including commuting) you need to include an employee benefit amount in W-2 wages. The Internal Revenue Service has established valuation guidelines to be used in calculating this benefit.

The easiest way to fulfill the reporting requirement is to add the calculated benefit amount to the last pay period of the year. To help you calculate this amount, we will need the following information:

  • Vehicle’s fair market value on the date it was first available to an employee
  • Current year’s total miles driven
  • Current year’s personal miles driven
  • The vehicle year, make and model

If this applies to your company, please contact our office before your last pay period. We can calculate the amount of the employee benefit and answer any questions you might have. If the calculation for personal use is not done prior to the company’s last payroll, the W-2s will need to be amended at an additional cost to the company.

This same calculation also applies to the personal use of a company vehicle by partners and Limited Liability Company members. If you use a company vehicle for personal use, please provide the above information to our office at year end, with your tax return information.