No company car......car allowance

Quote

Anonymous

Guest
what do most companies offer for a car allowance if they don't provide a company car?

So say you take a job with a company offering $x00/month for car allowance, and you don't currently have a car. How much should be enough to cover the "wear n tear" on your personal car?

would you just buy something cheap?

also, if a company is offering an allowance, do they pay your car insurance separately?
 








You can find a mix of all of the above. Usually an allowance does not include auto insurance. I have seen allowance between 640 and 800 dollars a month. I personally would lease a car for 200 or 300 bucks and have the lease include all wear/repairs. Often these companies will include a gas card. But with the price of gas, I would be more worried about this than insurance especially if you get a large territory. You also want to find out how fast a company pays their expensesdow and if it is on your credit card or theirs. These questions are best saved for a second interview and not really a phone screen or first meeting.
 








I have heard about $400-500 for car allowance. This is supposed to cover everything, insurance, maintenance etc. They may reimburse for mileage. I'd buy a used Honda or Toyota and drive it into the ground. If you pay for the car outright, you pocket that car allowance.
 








Anonymous said:
I have heard about $400-500 for car allowance. This is supposed to cover everything, insurance, maintenance etc. They may reimburse for mileage. I'd buy a used Honda or Toyota and drive it into the ground. If you pay for the car outright, you pocket that car allowance.
Click to expand...
If you are going to stay on "allowance" program, you put that money in a savings account and use it for tires, etc and the rest to buy the next car when the first one finally craters.
 








I bought a very nice European car (used but 30,000 miles on it) for cash and pocket the allowance. Repairs have been minimal and wear and tear, well, it is a car and a depreciating asset anyways so I don't really care.
 








Just keep good records and everything over the amount of the car allowance is deductible on your income tax return as non-reimbursed expenses.

If the company adds the allowance to your W2 as untaxed income, so you'll be able to deduct everything you spend on the job.
 








Many companies who offer car allowances usually have a provision that your car must be no more than "x" years old or no more than "x" miles, primarily to prevent you from having an old beater with a hood, trunk, and three doors of differing colors.

And it makes sense. If you were the employer, you wouldn't want your representative to have a car that looks like it was rescued from the Cash For Clunkers program just before the magnet was gonna dump it into the shredder.

However, the enforcement of that rule may vary from company to company. Basically, if you have a neat, clean, presentable vehicle, most really don't care if it's a couple years older and with a few more miles than the agreement states.
 








I'm a contract rep and drive my personal car, a comfortable used car that I bought for $6200 when I got laid off from my last company. I get 51 cents per mile (the IRS rate) and I average about 150 miles per day (fairly large geography). That works out to about $1500 per month for my car allowance. My gas costs are currently about $450 per month. Insurance is less than $75 per month (no collision). I have put very little into the car since I bought it with 40,000 miles and currently am over 100,000. I've put enough in savings from the allowance that if this car starts to nickel and dime me too badly I can get another used one. All in all, not a bad deal.
 








Top Bottom
Back
Quote