Welcome Guest. Register Now!  

For 2016 Tax Tips For Year 2016.

LinkBack Thread Tools Search this Thread Display Modes
  #1 (permalink)  
Old 01-31-2017, 03:48 PM
Junior Member
Join Date: Jan 2017
Posts: 1
Business Use of Car Allowance

Hello, I have a unique situation that 2 different tax professionals I have used in the past have handled differently and I'm befuddled as to what is correct. Here is the situation:

Husband uses a personal car for business and personal use.
He receives $500/mo "car allowance" from his company.
His gas/maintenance/repairs are paid for by a company credit card.
At year end, he reports to the company how many of his miles were for business use (for a number, let's say 10,000 mi for 2016).
They then issue us a "Summary of Reported Business Use of Car Allowance" report showing that 10,000 miles x .54 per mile = $5,400. They then show that the total costs they incurred (which include the $500/mo + any gas/maintenance/repair costs) totaled $8,000 for the company. They subtract the $5,400 from $8,000 resulting in "additional W-2 income (that's what they're calling it...) of $2,600. They then add that in to his W-2 and tax him at year end for OASDI and Medicare taxes. There have been times when he doesn't even get a paycheck at end of Dec. because they have deducted so much in taxes from this resulting "add'l W-2 income".
My question is, can any of this be written off? My last tax preparer said I was to write off the "add'l W-2" income but that just doesn't seem right. Any suggestions?

Digg this Post!Add Post to del.icio.usBookmark Post in TechnoratiFurl this Post!Reddit! stumble!bookmark in google!Share on Facebook!
Reply With Quote

Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

vB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off

Similar Threads
Thread Thread Starter Forum Replies Last Post
Household Allowance Taxable? anderson Income 3 09-10-2016 07:41 AM
Meals allowance by client question farmboyfarm S-Corporation 3 08-31-2015 03:16 AM
Railroad Meal Allowance Help lemwoh71899 Income 1 02-11-2015 04:23 PM
Partial Mileage Reimbursement/Car Allowance loslobos9461 Auto Expenses 2 04-03-2013 01:58 PM
What is the Foreign Earned Income Exclusions and Housing Cost Allowance for 2011? TaxGuru Income 0 12-13-2011 02:44 PM

Follow us on Facebook Follow us on Twitter Google Buzz Rss Feeds

» Categories
 » Income
 » IRA/Sep
 » Medical
 » Payroll
Forum for CPAs
Financial Planning

» Recent Tax Q&A
No Threads to Display.