The value of any personal use by an employee of your vehicle may be calculated by multiplying the standard mileage rate (34.5 cents for 2001 and 36.5 cents for 2002) by the number of miles driven by an employee for personal purposes, if you provide your employee with the use of a vehicle that either:
A vehicle is considered "regularly used" in an employer's business if either at least 50 percent of its total mileage for the year is for the employer's business or it is generally used each workday in an employer-sponsored car pool to transport at least three employees to and from work. You may not use the cents-per-mile rate unless the same or comparable vehicle could be leased on a cents-per-mile basis. Once the cents-per-mile rate has been adopted for a vehicle, you must continue to use that valuation method until the vehicle no longer qualifies.
For 2001, the cents-per-mile method could be used only for cars that had a fair market value of $15,500 or less on the day they were first made available to an employee. This dollar amount is adjusted periodically to reflect inflation. For cars having a value in excess of that amount, the value of the availability of the car is to be determined under the general fair market value rule or the annual lease value method.
Maintenance and insurance are included in the standard mileage rate. However,
no reduction in the rate is allowed if you do not provide these services. The
rate also includes the fair market value of employer-provided fuel for miles
driven in the United States, Canada, and Mexico. If fuel is not provided
by you as the employer, the rate may be reduced by no more than 5.5 cents.