AMHERST, N.Y., Dec. 18, 2017 — Vehicle Reimbursement Programs (VRPs) reimburse a company's drivers for the expenses of driving their personal vehicles while on company business. The objectives of a VRP are:
There are three steps to building an accurate vehicle reimbursement program that is IRS compliant. IRS compliance means following the IRS Revenue Procedures governing a VRP, permitting payments to be designated as 'reimbursements' and not as 'compensation'.
THE THREE STEPS
The Three Step set-up produces rates according to the IRS FAVR guidelines – Fixed and Variable Rates.
The Fixed Rate reflects the costs required to put a vehicle on the road, to have it ready to drive. These are committed costs to buy a vehicle, and to plate and insure the vehicle to make it legally roadworthy. These expenses are in CarData's VED (Vehicle Expense Database) and are used to calculate the monthly Fixed Rate. The monthly Fixed Rate is denominated in dollars per month.
The Variable Rate reflects the ongoing costs of running a vehicle and maintaining its mechanical fitness. The Variable Rate is denominated as cents-per-mile. The Variable Rate is comprised of fuel costs plus a proportional amount for maintenance, oil, tires and repairs. These expenses are in CarData's VED (Vehicle Expense Database) and are used to calculate the monthly Variable Rate.
The following is an example of a monthly reimbursement for a driver in Boulder, Colorado.
Rates will vary by driver location and the number of business miles driven each month. It is a simple Three Step process to set up a sales team of drivers in their own specific reimbursements.
Learn more about CarData's Vehicle Reimbursement Solutions here: https://cardataconsultants.com/vehicle-reimbursement/
About CarData Consultants CarData provides precision vehicle reimbursement programs for the mobile workforce. CarData services save money, reduce risk, and remove administration. CarData programs are compliant with the IRS and the CRA procedures.
MEDIA Contact: Megan Dean
Marketing Communications | CarData Consultants Inc.
Direct: 303-434-3307 | FAX: 929-235-7525
[email protected]
www.cardataconsultants.com
SOURCE CarData Consultants
Powered by WPeMatico
