DAVISN HODEiDO)\j ASSOC:IATES CPAs PLC WORKSHEET TO CALCULATE INCOME FROM PERSONAL USE OF COMPANY VEHICLE EMPLOYER'S WORKSHEET TO CALCULATE EMPLOYEE'S TAXABLE INCOME RESULTING FROM EMPLOYER-PROVIDED VEHICLE FOR CALENDAR YEAR 2018 As a result of increasing IRS scrutiny, we are requesting more documentation as it pertains to company provided automobile mileage. Use the worksheet provided to calculate the value of personal use of any company-owned vehicles. The personal use should be added to the employee's W-2 or recorded as a shareholder loan. We will be requesting a completed copy of these worksheets as we begin preparing the business tax return for 2018. As part of that worksheet, we will also be asking for confirmation that you have documentation to support the business use of the vehicle as indicated on the worksheet. We will also need total mileage for the vehicle with the assumption that all other mileage will be treated as personal use (per IRS guidelines, estimates are not acceptable). We appreciate your understanding with regard to the need for the added documentation. *If desired, we can also provide sample auto usage policies to distribute to your employees. EMPLOYEE: DESCRIPTION OF VEHICLE: DATE VEHICLE FIRST MADE AVAILABLE TO ANY EMPLOYEE: DATE VEHICLE FIRST MADE AVAILABLE TO THIS EMPLOYEE: A. Last year's odometer reading B. This year's odometer reading C. Total miles for the year (B-A) D. Business miles E. Personal miles F. Personal % (C-D) (E/C) METHOD I- ANNUAL LEASE VALUE METHOD (For autos available 30 days or more) Fair market value of vehicle (to be re-determined at the beginning of the first year and every four years thereafter Annual lease value, per attached chart $ $ Enter number of days during the year that the vehicle was available X Divide by number of days in tax year Prorated annual lease value Personal use % (personavtotal miles, per "F" above) Personal annual lease value If fuel is provided by employer, enter personal miles x 5.5 cents X -------o/o $ + Personal use taxable income (to be added to employee W-2) =$ -------
HODS Dei)., CPAs PLC WORKSHEET TO CALCULATE INCOME FROM PERSONAL USE OF COMPANY VEHICLE EMPLOYER'S WORKSHEET TO CALCULATE EMPLOYEE'S TAXABLE INCOME RESULTING FROM EMPLOYER-PROVIDED VEHICLE FOR CALENDAR YEAR 2018 METHOD TI- STANDARD MILEAGE RATE METHOD Generally, in order to qualify to use the cents-per-mile method, the vehicle must: (1) be expected to be regularly used in the employer's business throughout the calendar year, or (2) be driven at least 10,000 miles per year, and (3) have a fair market value of $27,300 or less for passenger automobile or $31,000 or less for truck or van. Once this method is adopted for a particular vehicle, it must be continued until the vehicle no longer qualifies. Enter personal miles If fuel is NOT provided by the employer enter personal miles X $0.545 = ---- X $0.055 = $ ( ) Personal use taxable income (to be added to employee W -2) $ METHOD Ill - SPECIAL COMMUTING METHOD This method may only be used for vehicles covered by a written policy that allows commuting but no other personal use. DO NOT USE if employee is a 1% or more owner, an officer with compensation of $110,000 or more, or an individual with compensation equaling or exceeding $220,000. Number of commuting round trips made Value per round trip Personal use taxable income (to be added to employee W -2) x,$=3=.0=0 $
HODSDON CPA s PLC EMPLOYEE REPRESENTATION REGARDING USE OF COMPANY VEHICLE TO BE COMPLETED BY ALL EMPLOYEES WHO WERE PROVIDED A VEHICLE The IRS requires employers to provide certain information on their tax return with respect to the vehicles provided to employees. This information is also used to calculate the amount of the fringe benefit to be included on your Form W-2 income. The IRS generally requires that written records be maintained to document the business use of vehicles. Since the company policy requires employees to maintain the detailed records, please provide answers to the following questions. If you were provided more than one vehicle that was used during the year, you need to prepare a separate statement for each vehicle. The completed form must be returned no later than (date) or 100% of the value of the use of the vehicle will be included in your Form W -2 income. Employee name Description of vehicle Reporting period from to Odometer reading: Beginning _ Ending Employee Representation (1) Was the vehicle available for your personal use during off-duty hours? YES NO (2) Did you have another vehicle available for your personal use (this includes a vehicle you own personally)? (3) Are you an officer or 1% or more owner of the business? (4) How many commuting round trips did you make in this vehicle? (5) For the reporting period specified above, please provide the number of miles for each of the following categories: Commuting miles Other personal (non-commuting) miles Total personal and commuting miles Total business miles Total miles ( 6) Did the employer pay the cost of fuel consumed by this vehicle? (EMPLOYEE SIGNATURE) (DATE) 1:\Common\Tax\Checklists & Worksheets\Comoanv vehicles\comoanv Vehicle Wkst(s) for 20 18 Uodated.docx
DAVISN HODSDON AS!iDC I A T I!!S CPA s PLC YEAR-END PAYROLL REPORTING WORKSHEET Company: Employee: Please process the following as part of my payroll for the period D Health insurance premiums for greater than 2% shareholders of an S Corporation Please add$ to box 1 of the above employee's W-2 wages for year-end reporting purposes. In accordance with IRS regulations, this amount should not be subject to withholdings for Social Security, Medicare, FUT A, SUT A, Federal Income Tax or State Income Tax. Please include the above amount in box 14 with a description of"2% HI" D HSA Contributions for greater than 2% shareholders of an S Corporation Please add$ to box 1 of the above employee's W-2 wages for year-end reporting purposes. In accordance with IRS regulations, this amount should not be subject to withholdings for Social Security, Medicare, FUT A, SUT A, Federal Income Tax or State Income Tax. Please include the above amount in box 14 with a description of"2% HSA" D Personal use of company vehicle Please add$ to box 1 of the above employee's W-2 wages for year-end reporting purposes. In accordance with IRS regulations, this amount should be subject to withholdings for Social Security, Medicare, FUT A, SUT A. Please include the above amount in box 14 with a description of"auto" D Withhold Federal Income Tax and State Income Tax D Do not withhold Federal Income Tax and State Income Tax D Group term life insurance of$. Please add to the above employee's W-2 wages for year-end reporting purposes. In accordance with IRS regulations this amount should be subject to withholdings for Social Security, Medicare but not subject to FUT A, SUT A, Federal Income Tax or State Income Tax. D Bonus Please include the above amount in box 12 with a code of"c" Please add$ as a bonus to the above employee's W-2 wages. D The bonus should have withholdings for all payroll taxes and income taxes in accordance with general processing policies for bonuses. D The bonus should be paid out as follows: Gross bonus amount $ Social Security withholding $ Medicare withholding $ Federal Income tax withholding $ VT State Income tax withholding $ Net bonus amount $ 1:\Common\Tax\Checklists & Worksheets\YE PAYROLL Reporting Worksheet 20 18.doc
D-r HDD6DDN ASSOCIA T ES C PA s PL C SAMPLE AUTOMOBILE USAGE POLICIES 1. POLICY PROHIBITING ALL PERSONAL USE OF COMPANY VEHICLES Management has adopted the fo ll owing policy regarding personal use of Company-owned ve hicles: Vehicles owned or leased by thi s Company are to be used so lely for Company business. There shall be no personal use of the vehicles (including commuting to and from wo rk). fndividu als driving Company vehicles may have occasions where an incidental stop is necessary between business stops. Such use shall not be considered to be in violation of this policy. The Company requires that ve hi cles not in use shall be parked in designated areas on the Company premises. No personal items are to be stored in the vehicles. Company materials and supplies are to be secured in the trunk, lock boxes or within the Company offices. Keys are to be returned to upon the close of business each day.
D-f HDD6DDN CPA s PLC SAMPLE AUTOMOBILE USAGE POLICIES 2. POLICY PROHIBITING ALL PERSONAL USE OF COMPANY VEHICLES EXCEPT COMMUTING Management has adopted the following policy regarding personal use of Company-owned vehicles: For business reasons, certain employees have been des ignated to drive a Company-owned vehicle to and from their res idence. This shall be the only authorized personal use of the ve hicle. Individuals dri ving Company ve hicles may have occasions where an incidental stop is necessary between business stops. Such use shall not be considered to be in violation of thi s policy. The Company requires that no personal items other than incidentals be stored in the vehicle. The vehicle is to be locked when not in use with work a1t icles stored either in the lock box or trunk during tim es when the vehicle is not in use. The Company will compute a daily va lue for the commuting which w ill be included in the employee's Form W-2 at the end of the ca lendar year. Such amount will be the minimum allowed by federal income tax laws. Note: Jntemal Revenue Service regulations require the Company to maintain evidence which would enable the IRS to determine whether use of the vehi cle is in accordance with policy maintained by the Company.
HDD6D DN C PA s PLC SAMPLE AUTOMOBILE USAGE POLICIES 3. POLICY REGARDING CUT-OFF DATE TO CALCULATE THE VALUE OF PERSONAL USE OF COMPANY -OWNED VEHICLES Management has adopted the following policy regarding computation of the taxable value of the personal and commuting use of Company-owned vehicles: The personal and commuting use of Company vehicles will be computed for the twelve months ending (October 31, November 30 or December 31 ). Annually, the Company requires you to provide complete accounting of the personal use of the vehicle as of. The taxable value ofthe personal use will be computed using the least costly method allowable by tax law. This income will be considered paid as of and federal, state (if appropriate) and Social Security/Medicare* withholding will be deducted from your paycheck. OR The taxable value and related withholding amounts will be reflected on your Form W-2 at year-end. Please address your questions to *The Company may elect to withhold only Social Security/Medicare. If so the paragraph should read as follows: This income will be considered paid as of and Social Security/Medicare withholding will be deducted from your paycheck. I:\Co rnmon\tax\checkiists & Worksheets\Compan y ve hicle>\sam PL E AUTOMOB IL E USAGE POLIC IES 20I8.docx