Tax-Free Commuter Benefits with TransitChek

Individuals looking for ways to save on taxes in the year ahead should sign up for a tax-free commuter benefits program offered by their employer. These commuter benefits programs allow individuals to set aside up to $110 a month from their pre-tax salaries to pay for transit and vanpool expenses, and up to $215 a month for commuter parking. Under Section 132(f) of the IRS Code, the program is only offered through employers and can also be structured as a fringe benefit. If your employer offers this type of program, participation can give the average commuter $500 in tax savings annually.

These programs offer an incentive to use public transportation in your commute, over driving yourself. You save money on taxes, as well as saving the cash for gas and parking at the office. The tax benefits are only available for funds used for COMMUTER lots and public transportation.

Employers may offer employees a tax-free benefit for commuting by transit and eligible vanpools or to pay for commuter parking under IRS tax code section 132(f). Tax-free commuter benefits can be structured as an employee-funded pre-tax payroll deduction; as an employer-funded benefit; or the costs can be shared by employer and employee. In 2007, the IRS increased the maximum allowable monthly tax-free amount to pay for transit to $110, and for commuter parking to $215. The benefit can be delivered in the form of transit provider-specific passes, universally accepted vouchers and terminal–restricted debit cards, or through a reimbursement model under specific conditions defined by the IRS.