2019 Fleet Average Valuation and Vehicle-Cents-Per Mile Number Released

The IRS has released 2019 maximum vehicle fair market values for use with the vehicle cents-per-mile valuation rule and the fleet-average valuation rule.

The IRS is also providing flexibility for 2018 and 2019 in the consistency requirements for use of the vehicle cents-per-mile and fleet-average valuation rules.

Maximum Vehicle Fair Market Values for 2019

The maximum value is $50,400 for:

  1. an employer-provided vehicle (including cars, vans, and trucks) first made available to employees for personal use in 2019 for which the vehicle cents-per-mile valuation rule may apply; and
  2. an employer-provided automobile (including vans and trucks) first made available to employees for personal 2019 for which the fleet-average valuation rule may apply.

Consistency Requirements Relaxed for 2019

The IRS intends to revise regulations for employers whose vehicles did not qualify for vehicle cents-per-mile valuation under the rules in effect before 2018 because the vehicle’s fair market value exceeded the maximum permitted.

In such a case, the employer may first adopt the vehicle cents-per-mile valuation rule for the 2018 or 2019 tax year based on the higher maximum fair market value of a vehicle for 2018 or 2019, as applicable. The employer generally must continue to use the vehicle cents-per-mile valuation rule for all subsequent years in which the vehicle qualifies for the rule. However, the employer may use the commuting valuation rule for any year the vehicle qualifies for that rule.

Similarly, if an employer that did not qualify to use the fleet-average valuation rule before January 1, 2019, because it could not meet the pre-2018 maximum value limitation, the employer may adopt the fleet-average valuation rule for 2018 or 2019, if it meets the maximum vehicle values for 2018 or 2019 as applicable.

Notice 2019-34