Tax & Accounting Blog

IRS Rev. Proc. 2012-13 Specifies Value Limitations for 2012 Employer-Provided Vehicles for Sec. 1.61-21 FMV of Personal Use by Employees

ONESOURCE January 30, 2012

IRS Rev. Proc. 2012-13, issued on January 13, provides:

1) The maximum value of employer-provided vehicles first made available to employees for personal use in calendar year 2012 for which the vehicle cents-per-mile valuation rule provided under Section 1.61-21(e) of the Income Tax Regulations may be applicable is $15,900 for a passenger automobile and $16,700 for a truck or van;

2) The maximum value of employer-provided vehicles first made available to employees for personal use in calendar year 2012 for which the fleet-average valuation rule provided under Section 1.61-21(d) of the regulations may be applicable is $21,100 for a passenger automobile and $21,900 for a truck or van.

If an employer provides an employee with a vehicle that is available to the employee for personal use, the value of the personal use must generally be included in the employee’s income and wages. The value of the personal use may be determined under the vehicle cents-per-mile valuation rule of Section 1.61-21(e) of the tax regulations; or, for employer-provided vehicles available to employees for personal use for an entire year, generally, the value of the personal use may be determined under the automobile lease valuation rule of Section 1.61-21(d) of the regulations, if the fair market value of the vehicle does not exceed the specified dollar limit. If the FMV exceeds the specified dollar limit, the personal-use value to the employee must be determined using other, more complex regulatory rules.