Tax Implications for Personal Use Vehicles - Annual-Lease-Value Method (Word)

Tax Implications for Personal Use Vehicles - Annual-Lease-Value Method (Word)

<p> [Date]</p><p>M E M O R A N D U M</p><p>TO: [name of person]</p><p>FROM: The Research Foundation of State University of New York</p><p>SUBJECT: Tax Implications for Personal Use Vehicle – Annual-Lease-Value Method</p><p>This letter provides notification of the personal income tax implications of the company car provided to you by The Research Foundation of SUNY. The personal use of the car is considered taxable income and therefore must be reported on Form W-2, as stated in Circular E, Publication 15 B of the IRS tax guide.</p><p>The vehicle purchased on your behalf in YEAR for $0.00 exceeds the Internal Revenue Service maximum value for the Cents-Per-Mile rule, which is $15,200. Therefore, the method used to calculate the taxable value of your car for YEAR will be the Annual Lease Value rule. Under this method, the Annual Lease Value is computed to be $0.00. At the end of the calendar year we will multiply this amount by the percent of personal use of the car to calculate the taxable value for the year. This amount will appear on your last pay stub of YEAR. The amount is subject to Social Security and Medicare tax but not Federal or State income tax. </p><p>The taxable income will appear in Box 1 ‘Wages, Tips and Other Compensation’, Box 3 ‘Social Security Wages’, Box 5 ‘Medicare Wages’ and Box 14 ‘Other’ on your W-2 for YEAR. If you have questions regarding how to record this on your personal income tax return, you should seek professional advice from the Internal Revenue Service or an income tax advisor.</p><p>To record your miles, please submit your mileage information on the attached form. This form should be submitted to Name Of Office Responsible For Payro ll Matters no less than quarterly but may be submitted monthly.</p><p>Sincerely, </p><p>Attachments: Taxable Value of Personal Use of an RF Provided Vehicle</p>

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