Motus Infographics

The True Cost of a Car Allowance Program

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that if you're paying your employees a "lump sum" towards their car expenses, YOU have to pay FICA taxes, and THEY have to pay income taxes because this amount is considered compensation? We will calculate an IRS-compliant, tax-free reimbursement rate for each of your employees. thinks they're paying $300, but aer FICA taxes, they're really paying $322.95. If needed, we will set a floor for the reimbursement rate so employees receive at least as much in reimbursement as they were receiving from their car allowance. Your employees now receive an accurate reimbursement that reflects their business mileage and the costs of owning and operating a car in their home zip code. DID How Motus Helps Remove Tax Liability TRUE CAR ALLOWANCE PROGRAM of a COST The YOU KNOW The Employer loses money due to federal, state, and local income taxes and ends up taking home only $225.* and you're paying them $300/month, you could be saving $1,175 per driver, per year. The Employee The Solution If you have mobile employees *Based on income tax rate of 25%

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