NAFA's argument is that while gas vehicles are refuled at service stations, EVs are often charged at employees' homes. The IRS already addresses reimbursement for traditional vehicles, but is silent on charging rules.  -  Photo:  dcbel/Unsplash

NAFA's argument is that while gas vehicles are refuled at service stations, EVs are often charged at employees' homes. The IRS already addresses reimbursement for traditional vehicles, but is silent on charging rules.

Photo: dcbel/Unsplash

According to an email sent to its members on July 1, NAFA Fleet Management Association has requested that the Internal Revenue Service issue guidance to address the fringe benefit implications of at-home charging of an employer-provided electric vehicle (EV).

In a June 10 letter to the IRS Chief Counsel, NAFA agreed that while the fringe benefit treatment of an EV should not be any different from an employer-provided gasoline vehicle, the facts and circumstances are different for EVs. 

NAFA said, “In simplest terms, the gasoline vehicle may be refueled at the local service station, while the electric vehicle may refuel (charge) in the employee’s garage.” 

The association pointed out that while IRS rules address reimbursement for gasoline, the rules are silent on reimbursement for kilowatt hours for charging. 

Its recommendation to the IRS is that a fair and reasonable employer reimbursement for the kWh cost of at-home charging be considered by the IRS as provided for non-compensatory business reasons and excludable from an employee's income as a working condition fringe benefit. 

Further, NAFA recommended that all costs associated with a Level 2 charger for take-home vehicle, including installation, be considered a non-compensatory business cost with reimbursement excludable from an employee's income as a working condition fringe benefit.

NAFA said the IRS is currently reviewing its request.

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