What is car allowance
What is a car allowance?
With a car allowance program, employees receive a set monthly allowance to offset their business-related driving costs. A car allowance program is simple, but the greatest disadvantage is that the program is taxable and does not account for:
- Fuel costs
- Insurance premiums
Advancing your car allowance
Advancing Your Allowance Program
Runzheimer can eliminate tax waste associated with car allowance programs by substantiating business miles. Equo® Mileage Capture will let you take advantage of tax-saving benefits with automated mileage tracking.
Moving from an allowance program to an accountable program will allow for:
- Reduced tax liability
- Seamless program management
- IRS-compliant mileage substantiation
By reducing taxability of the allowance, your employees receive a higher payment each month.