• The IRS recently clarified the availability of the "cents-per-mile" method of valuing the personal use (including commuting) of an employer-provided car. Churches that permit an employee to use a church-provided vehicle for personal purposes (including commuting) must include the value of such personal use on the employee's W-2 form. There are a number of ways that the personal use can be valued. A commonly used method is the "cents-per-mile" method, under which the standard mileage rate (22.5 cents per mile) is multiplied times the number of miles that an employee uses the vehicle for personal use. However, this method of valuing the personal use of an employer-provided vehicle is not available for vehicles whose fair market value exceeds a specified dollar limit. For 1985 and 1986, that value was $12,800. For 1987, the value dropped to $9,110. However, the IRS has announced that the figure for 1987 is being increased to $12,060. Accordingly, the cents-per-mile valuation method was available in 1987 to church employees if the fair market value of the church-owned vehicle was less than $12,060. IRS Notice 88-17.
