Employer Transportation Benefits in the United States
- Employer Transportation Benefits in the United States
An employer may provide transportation benefits that are tax free up to a certain limit. Under the US Internal Revenue Code section 132(a), the qualified transportation benefits is one of eight types of statutory fringe benefits excluded from gross income. The two types of qualified transportation benefits are (1) transit passes and van pooling and (2) parking. Bike commuters can be reimbursed for certain expenses beginning in 2009. [cite news | first= | last= | coauthors= | title=Bike commuter benefit now law | date= | publisher= | url =http://www.cyclelicio.us/2008/10/bike-commuter-benefits-act-passes.html | work = | pages = | accessdate = 2008-10-07 | language = ]
Employer provided transit passes and van pooling
For the 2008 tax year regular employees are allowed up to $115 a month for the combined value of employer provided transit passes plus commuting on an employer's van or bus. Any amount over the tax free amount is should be included in gross income.Qualifying transit passes include tokens, fare cards, or vouchers for mass transit or private transportation businessesQualifying van or bus pool vehicles much seat at least six passengers and be used at least 80% of the time for employee commuting.
Parking provided by employer
For the 2007 tax year regular employees are allowed up to $215 per month in tax free parking or subsidized up to that amount. Any amount over the taxable amount should be included in gross income. According to the Internal Revenue Service (IRS), parking benefits are to be valued according to regular commercial price for parking at the same or nearby location.Parking must be on or near the employer's premises, at a mass transit facility such as a train station or car pooling center. [J.K. Lasser Institute, Your Income Tax 2008, John Wiley & Sons, 2007]
Bicycle commuter expenses
Beginning in 2009, employers may reimburse bicycle commuters up to $20 per month tax free for each month a bicycle is used for transportation between the employee's home and place of employment. Reimbursement may be for a bicycle, bicycle improvements, repair and storage. Bike commuters who receive any other transportation fringe benefit under Section 132 are not eligible to receive the bike commuter benefit.
Treasury Regulations
Treasury Regulations provide for an additional type of transportation benefit. The value of a special vehicle design (such as bulletproof glass) intended to provide security is excludable from gross income if the design is for a bona fide business-oriented security concern. [Treas. Reg. § 1.132-6(d)(2)(ii).]
References
Wikimedia Foundation.
2010.
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