You posted this while I was replying: "and any 2-percent shareholder of the S corporation shall be treated as a partner of such partnership"

Yet, in your title ("more than 5%- driving S Corp vehicle 20% for personal use and Form W-2.") and originally, you tried to note that 5% would be your guidance.

The Fringe Benefit regulations fall under differing % because they provide for different plans, such as Adoption vs Vehicle use; and the tests for highly compensated employees and to avoid impartial treatment of employees. Mostly, all of this is to help avoid personal life costs being shifted into a corporation's expense reporting to benefit the shareholders personally.