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FAVR Reimbursement Plan (Fixed + Variable Rate)

Tax-free vehicle reimbursement that beats the 67¢ IRS rate for high-mileage drivers.

Overview

IRS Revenue Procedure 2019-46 FAVR plans reimburse employees who use personal vehicles for business at a FIXED portion (insurance, depreciation, registration — based on vehicle standard) + VARIABLE portion (per-mile fuel/maintenance). For high-mileage drivers (>15K business mi/yr) FAVR delivers $8K–$14K/yr tax-free — significantly more than the 67¢ IRS rate — while remaining tax-free if properly structured (Motus, Cardata, mBurse are common admins).

Best fit
Field sales/service employersHigh-mileage territory repsCompanies with 10+ mobile employees
Estimated impact
$3K–$6K/employee/yr vs IRS-rate reimbursement, all tax-free

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