Vehicle expenses

[cs]

Work has revised it's vehicle expenses for employees. It was only where I was getting $0.40 a mile and that was it.

They have now worked out a new policy where project managers (that is me) get an additional $100 a month in addition to our mileage and they have upped the mileage rate to $0.445.

This is pretty cool as now I will have a little more cash than I did before.

What bugs me though is the other project manager in the office don't think that this is fair to him. Of course like me, this is an increase for him. He gets exactly what I get.

His issue is that while I put X amount of miles on my truck he may put X * Y amount of miles on his truck. He thinks that because he puts more miles on his truck his monthy allowance (the $100) should be more. He don't care that he makes up the difference in his millage rate. He thinks he should get that plus more of the base expense.

I think he is a (insert bad word that starts with dumb and ends with a S) and just wants to take advantage of the company.

He will not get what he wants and I'm more than happy with what they are giving us.

Chad

[uncas]

Tell him to buy a more gas efficient vehicle...
ot stuff it..
He should be happy for any compensation for gas plus mileage...

[High C]

Mathematically, he's right. His per mile rate is less than yours.

You guys know that you can deduct (as an income tax deduction) the difference between what you're reimbursed, and what the IRS allows?

Keep track of those miles, there's a bit of a deduction there.

Edited to add: Since your base rate has been raised to .445, you're actually over the allowed .45 when you add in the value of the $100, unless you drive about a million miles a year. ;) So, no deduction. (I thought it was higher than that, because briefy, it was, .485 after Katrina, but has since been lowered)

[ 01-21-2006, 09:57 AM: Message edited by: High C ]

[Gary E]

This is pretty cool as now I will have a little more cash than I did before.
You think so huh.... all depends on what you do with it..

Be carefull that when this one needs replacment, you have put away enuf of what you get to actually buy something.

[George Roberts]

There are some fixed costs like insurance so he might be right.

But at $.445/mile, you both should be making a profit.

[Bruce Hooke]

If he thinks the monthly allowance should be tied to miles driven then there really is no point in the monthly allowance -- it would make more sense to just do everything as a flat per mile reimbursement.

It seems to me that a key question is what is the monthly allowance supposed to be for? Is the thinking that it costs a certain amount just to own a vehicle even if you never drive it? That has some justification, but only if you would not own these vehicles if you didn't have to use them for work, which I doubt (how would you get to work?). I suppose the best justification I can come up with is that you might have purchased more expensive vehicles than you would have otherwise because of the way you use the vehicles at work. If that is the case then no matter how much or how little you drive the vehicles your monthly "car" payments are going to be higher than they would otherwise be (or the total cost of the vehicle spread out over the months you own it if you bought it cash rather than on a loan). If that applies, then it is a pretty good justification for the monthly $100, and for it being the same for both of you.

Basically what I am getting at is if you can come up with a logical explanation for the $100 then that might make it more palatable to the other guy. I do have to say that it strikes me as somewhat unseemly for him to be complaining about what is already a pretty generous vehicle allowance.

[cs]

I've always felt that our mileage allowance was pretty good. It has always been higher than what most folks get. To through in an extra $100 and than raise the per mile rate is just gravy to me, and should be to him also.

BTW the reason his mileage is so much higher than mine is that he spends most of his time out of the office. Whether it is work releated or not is debatable. :rolleyes:

Chad

[ssor]

I actually profit from the IRS mileage allowance. Operating my work vehicle doesn,t cost me as much as the deduction is worth.