Drive for work. Drop the tax.
Avoid tax waste
Stop losing money from car allowances and make your business tax-efficient.
Streamline logs and payments
Save hours of work by automating mileage logging and payment processing.
Maintain insurance compliance
Verify driver insurance policies to minimize your risk profile.
Why Fixed and Variable Rate (FAVR)?
Unlike old-school vehicle programs like allowances and company cars, FAVR is an IRS compliant regionally sensitive approach to vehicle program management. This strategy allows organizations to offer accurate, fair market reimbursements to their drivers on the road for work completely tax-free.
The fixed reimbursement covers the costs of vehicle ownership, such as insurance, taxes, and depreciation. This is calculated by factoring in the driver’s location and annual mileage to accurately reimburse for business use of personal vehicle ownership.
The variable portion is applied to each business mile driven, changing month to month with market costs. This covers costs of vehicle operations, including elements like fuel, vehicle maintenance, and tires.
The most popular program choice, FAVR allows you to offer tax-free reimbursements to your full time drivers, even over the IRS standard rate equivalent ($0.67 per mile in 2024). Requirements include a minimum mileage of 5,000 per year.
Drive easy with Cardata’s FAVR program:
Leverage powerful software
Mileage tracking, payment processing, and business intelligence reports turbocharge your program.
Never miss a mile with best-in-class GPS capture technology.
Manage drivers, approve mileage, and generate reports with Cardata Cloud.
Precisely process payments for your employee drivers.
Reduce liability and promote accountability. Define your company driving policy and validate insurance.
Design your vehicle reimbursement program policy.
Validate your employees’ insurance coverage with simple software.
Adhere to corporate policies and IRS guidelines with expert help.
Ensure total tax-efficiency
Get the most from your reimbursement program. Stay totally tax-compliant and streamline employee operations so you can save money and keep growing your business.
Easily separate reimbursements from income. Stay in the IRS good books.
Maintain federal tax compliance so you can focus on growing your business.
Ensure employees get accurate reimbursements and minimize tax waste.
Get expert support
Whether you need support managing your program or you find yourself getting tied up in administrative work, you can always rely on the Cardata team to lend a hand.
Connect with an account manager to ensure your program is working for you.
Outsource administration to our experts for complex reimbursement tasks.
Get peace of mind knowing a trusted support rep is just a phone call away.
See what users are saying
Don’t just take it from us. Hear why best-in-class enterprises use Cardata’s FAVR program and software for employee driver mileage reimbursement.
"Mileage tracking made easy. Customer service is excellent!"Richard L.
"Our company has hundreds of drivers to track, verify, reimburse so this program is great for a company our size. It's very user-friendly for both the driver using it and the manager verifying it."Dan H.
“I like the ease of inputting mileage and knowing what my reimbursement will be. As well as knowing the IRS guidelines.”Stephon B.
FAQ about FAVR
FAVR is a vehicle reimbursement program sanctioned by IRS tax law. It is an acronym for “fixed and variable rate” reimbursement.
When your employee drivers meet the criteria for the FAVR program, reimbursements are paid totally tax-free. Driving is a legitimate business expense, and the IRS stands by that belief in its guidance for FAVR programs.
With Cardata’s powerful software and keen program oversight, we can ensure your reimbursement program remains IRS-compliant and tax-efficient.
Cardata verifies every driver’s insurance policy to minimize your risk profile. The wrong insurance endorsement can leave you liable, but Cardata takes care of that. There are more than 100 insurers in the US, but we have the expertise to verify all their various policies.
The right insurance coverage is a requirement for FAVR programs. Cardata works with every driver to make sure they are covered.
A FAVR allowance is calculated by gathering local cost data for things like fuel, maintenance, and repairs; vehicle information like depreciation schedules and parts prices; and driver behavior facts like mileage bands. Once you have all this information, you can create one fixed monthly allowance rate, for example $300 per month, and one variable per-mile rate, like $0.20 per mile. Every month, you pay the fixed allowance to the driver, together with the variable rate times a tally of their miles driven.
The Cardata savings calculator
Find out what efficiencies await. Compute the future business benefits a new vehicle reimbursement program could bring.