Employers that use the standard mileage rate to value employees’ personal use of company vehicles are restricted to supplying them with vehicles of modest value.
For 2012, the value of company cars that qualify for the standard mileage valuation method is $15,900, an increase of $600. The fair market value limitation for company SUVs is $16,700, up $500.
For pricier vehicles, you must use the lease valuation method or the general valuation method to value employees’ personal use of company vehicles. (Rev. Proc. 2012-13, IRB 2012-3)