Question

Lakiesha is an employee who drives a 2019 Buick Verano as a company car. The fair-market value of the car is $28,545. She has been given the choice to have her fringe benefit reported on her W-2 either using the lease-value rule or the cents-per mile rule. According to Publication 15-b, the lease value is $7,750. She has driven 4,500 miles for personal use and 31,250 miles in total during the year. The car has been available for use on 200 days during the year. Lakiesha's employer pays for all fuel. What method and valuation will yield the lowest fringe-benefit amount for Lakiesha? (Do not round intermediate calculations, only round final answer to two decimal points.)

Answer 1

Answer:

Lease value          

Step-by-step explanation:

The lease value may bed defined as an open market capital valuation of the parts of the subject or the subject that are to be leased in regards of the terms of the lease.

In the context, Lakiesha drives a company car whose value is $ 7,750 according to 15-b publication. The car was available for 200 days in a year. She drove the car for 4500 miles for her personal use and 21250 miles in total. The fuel is paid by the employer. So here the best method that will yield the lowest fringe benefit amount for her is the lease value method.