The American Taxpayer Relief Act of 2012 (HR 8) has restored the pre-tax transit and vanpool commuter benefits to be on par with the qualified parking benefit. For the 2013 calendar year:
- up to $245 per employee per month for vanpool and all public transportation
- up to $245 per employee per month for qualified parking, or
- up to $490 per employee per month for both public transportation and qualified parking
The effective date for the revised limits above allows for retroactivity back to January 1, 2012 if an employer so chooses under Sec. 203.
In 2012, the IRS Transportation (Commuting) Benefits rolled back to pre-2009 levels of $125 per month (adjusted for inflation) for vanpool expenses and public transit passes. The maximum was temporarily raised to $230 per month under The American Recovery and Reinvestment Act (ARRA) of 2009 and extended under the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 to equal the monthly qualified commuter parking limit.
Qualified bicycle commuting reimbursements will remain unchanged at $20 per month in the new year.
By offering pre-tax commute benefits to employees, employers can save on paying FICA payroll taxes and employees can take advantage of saving on federal withholding and FICA taxes on the amount deducted. Find out more from these third-party commute benefit administrators: Benefit Resource Inc., Clipper Direct, TranBen, TransitCenter (TransitChek), and WageWorks.
Image Credit: 401(K) 2013