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Tax Benefits for Commuters
You can reduce your commuting costs by sheltering a portion
of your income from federal taxes.
"Rarely does an employee benefit save both the employee and employer money.
But through a great twist of the tax code, you may be able to commute with
tax free dollars, and save your boss tax dollars, too."
~ Kiplinger's
Personal Finance Magazine
Qualified transportation fringe benefits (Section 132(f) of the Internal
Revenue Code) or Commuter Tax Benefits" are like money in the bank.
Employers save on payroll related taxes. Employees save on federal income
taxes.
Employers may continue to provide workers with up to $230 per month in
tax-free transit and vanpool benefits in 2010. The monthly limitation under
Section 132(f) (2)(A) Qualified Transportation Fringe Benefits regarding the
aggregate fringe benefit exclusion amount for vanpools (commuter highway
vehicles) and transit passes is $230.
The monthly limitation under Section 132(f) (2) (B) regarding the fringe
benefit exclusion amount for qualified parking is $230. Commuters can
receive both the transit and parking benefits (i.e., up to $460 per month).
Employers can allow employees to use pretax dollars to pay for transit
passes, vanpool fares and parking.
Quick Reference table on tax benefits.
For more detailed information on commuter benefits click here.
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