On 2011-01-11 16:36:31 -0500, Christopher Muto > said:

> but i can't help but wonder about the tax consequences of this proposition.
> if the employer is reimbursing you for any or all of the car that would
> probably be taxable income, and that means it would cost you at least
> 30% out of pocket. so say you got a $40,000 car and your employer paid
> you $32,000 (80% of the value), it would cost you at least $9,600 in
> taxes plus the 20% or $8,000, making it more like they were only
> offering to pay you only 50% of the cost of the car for you to use
> mostly for work. doesn't sound so attractive to me, particularly if
> you were to buy a new car that looses much of it value the instant its
> wheels roll off the dealers lot. i suggest either suggesting the
> employer purchases the car outright themselves as well as pay for the
> insurance and they simply lend it to you, otherwise it doesn't strike
> me as generous but rather a good way for them to save a tremendous
> amount of money by not having to buy it themselves. i know you asked
> about what model car to consider, but the actual cost of the car to you
> is an important part of the decision and the tax consequences are a key
> part of that equation.

Thank you. Excellent point.

I was brought into this strictly because of my interest in cars, so we
did not spend much time talking about the financial side. I am not sure
if Mark has thought about the tax situation. Also it may be a shared
ownership kind of deal. In any case I will certainly e-mail your
comment to him.