Fixed and Variable Rate (FAVR)
Reimbursing tax-free for fixed and variable costs associated with driving for business. What’s more, FAVR is the only reimbursement method recommended by the IRS.
Vehicle Reimbursement Programs
With the right vehicle program, companies can provide fair and accurate reimbursements to all employees, reduce tax waste, improve employee satisfaction, and meet IRS and labor law regulations.
Reimbursing tax-free for fixed and variable costs associated with driving for business. What’s more, FAVR is the only reimbursement method recommended by the IRS.
Reimbursing a monthly flat stipend for all mobile employees. However, because a car allowance isn’t attributed to mileage, it’s taxed as additional income, generating a lot of tax waste.
Reimbursing at the IRS rate or a custom rate. Mileage fraud can be a large issue, as well as equity. Mileage reimbursement doesn't account for geographic cost differences.
FAVR for the Financial Leader
Car allowance, mileage reimbursement, and fleet programs often have expensive hidden costs you may not realize. Did you know a car allowance program creates an average of $2,712 annual tax waste per employee? Or that fleet programs cost about 30% more than FAVR.
FAVR is the fair and accurate business vehicle program option. Reimbursements using this approach factor the geographic cost differences for each employee’s location, have no tax waste and accurately reflect each employee’s business mileage.
Discover how The Flint Group attained 7-figure savings by implementing the right vehicle program.
FAVR for the HR Leader
The importance of flexibility to today’s employees extends beyond remote work strategies into freedom of choice when selecting the tools and equipment they use for work. This is especially true for vehicle selection, as many employees utilize their car for both business and personal use.
It's also crucial to implement fair and equitable policies that produce cost savings and increase efficiencies across your business. And as the workforce becomes increasingly mobile, it's important to evaluate the way you reimburse employees for their business mileage.
Download the guide below to learn how HR leaders can select the right mileage reimbursement policy for their business.