Annual Lease Method
EMPLOYER'S WORKSHEET TO CALCULATE EMPLOYEE'S TAXABLE INCOME RESULTING FROM A EMPLOYER-PROVIDED VEHICLE
EMPLOYEE:___________________________________________________________________________________________
DESCRIPTION OF VEHICLE_____________________________________________________________________________
DATE VEHICLE FIRST MADE AVAILABLE TO ANY EMPLOYEE: _
DATE VEHICLE FIRST MADE AVAILABLE TO THIS EMPLOYEE: ________
ANNUAL LEASE VALUE METHOD (For Autos Available 30 Days or More)
Fair market value of vehicle** (please see the meaning of FMV on the bottom of the page)
The FMV should also be redetermined at the beginning of the fifth year and every four years
thereafter.
Annual lease value, See chart Below.
If a partial year, first figure the portion (%) used. ( Divide (1) by (2) to get (3) the % of use:
(1) Enter number of days that the vehicle was available to use: ________
(2) Divide by number of days in tax year: 365
(3) Usage Percentage
Second, prorated annual lease value by multiplying Annual lease value, per chart with
the portion (%) that we got in the first step.
Annual lease value, See Chart Below
(read down column (1) until you come to the dollar range within
which the FMV of the automobile falls. Then read across to column (2) to find the
annual lease value)
Personal use% (personal/total miles, for example if employee use 2k miles of the 6k
total miles will be 33.3%.
Personal annual lease value
If fuel is provided by employer, enter personal miles x .067
Amount added to Taxable Wages on W2 $_______________
These wages are subject to Social Security & Medicare taxes. (FICA) in addition to Federal and State taxes
We will not withhold Federal Taxes unless requested by the employee.
"Fair Market Value" is the vehicle purchase price plus tags and sales tax. If the vehicle is leased, use the suggested retail price less %8. Use this for the first four years.
Annual Lease Value Table
Annual
Automobile fair market value Lease
Value
$0 to 999 .......................................................................................... $ 600
1,000 to 1,999 ........................................................................................ 850
2,000 to 2,999 ........................................................................................ 1,100
3,000 to 3,999 ........................................................................................ 1,350
4,000 to 4,999 ........................................................................................ 1,600
5,000 to 5,999 ........................................................................................ 1,850
6,000 to 6,999 ........................................................................................ 2,100
7,000 to 7,999 ........................................................................................ 2,350
8,000 to 8,999 ........................................................................................ 2,600
9,000 to 9,999 ........................................................................................ 2,850
10,000 to 10,999 ........................................................................................ 3,100
11,000 to 11,999 ........................................................................................ 3,350
12,000 to 12,999 ........................................................................................ 3,600
13,000 to 13,999 ........................................................................................ 3,850
14,000 to 14,999 ........................................................................................ 4,100
15,000 to 15,999 ........................................................................................ 4,350
16,000 to 16,999 ........................................................................................ 4,600
17,000 to 17,999 ........................................................................................ 4,850
18,000 to 18,999 ........................................................................................ 5,100
19,000 to 19,999 ........................................................................................ 5,350
20,000 to 20,999 ........................................................................................ 5,600
21,000 to 21,999 ........................................................................................ 5,850
22,000 to 22,999 ........................................................................................ 6,100
23,000 to 23,999 ........................................................................................ 6,350
24,000 to 24,999 ....................................................................................... 6,600
25,000 to 25,999 ........................................................................................ 6,850
26,000 to 27,999 ........................................................................................ 7,250
28,000 to 29,999 ........................................................................................ 7,750
30,000 to 31,999 ........................................................................................ 8,250
32,000 to 33,999 ........................................................................................ 8,750
34,000 to 35,999 ........................................................................................ 9,250
36,000 to 37,999 ........................................................................................ 9,750
38,000 to 39,999 ........................................................................................ 10,250
40,000 to 41,999 ........................................................................................ 10,750
42,000 to 43,999 ........................................................................................ 11,250
44,000 to 45,999 ........................................................................................ 11,750
46,000 to 47,999 ........................................................................................ 12,250
48,000 to 49,999 ........................................................................................ 12,750
50,000 to 51,999 ........................................................................................ 13,250
52,000 to 53,999 ........................................................................................ 13,750
54,000 to 55,999 ........................................................................................ 14,250
56,000 to 57,999 .........................................................................................14,75058,000 to 59,999 .........................................................................................15,250
For vehicles having a fair market value over %59,999, the annual lease value equals (.25*automobile Fair Market Value) + 500