Are commuter benefits Pretax?
Commuter benefits help you pay for your commute to and from work using pretax dollars, which saves you money on your taxes each year. You can use commuter benefits for transit, rideshares and qualified paid parking.
Do pretax commuter benefits expire?
Commuter benefits funds do not expire unless you leave your company. These funds will continue to rollover month to month, year to year, as long as you’re still at the same company. However, when you leave the company, any unused funds in your account will be returned to the company.
Is pre tax transit worth it?
On average, employees save 30% or more when they choose to set aside money in a pre-tax commuter benefit account. Employees with higher commuting expenses could save as much as $918* annually for both mass transit and parking.
What can I use pretax transit for?
What is the pre-tax transit benefit? The Internal Revenue Code allows employees to use pre-tax salary towards their transit and vanpool commuting costs. It is IRS Code, section 132(f) Qualified Transportation Fringe.
What can you use pre-tax transit for?
Commuters can use pre-tax dollars to pay for their commute (up to $270/month for transit and up to $270/month for qualified parking) and save on taxes. Subway, bus, train, ferry, car, or vanpool: We’ve got you covered. Employers also save money by driving down payroll taxes with every dollar an employee deducts.
How much do you save on pre-tax dollars?
Pre-tax deductions occur before the individual’s tax obligations are determined. This saves the individual on Federal, State, Local (if applicable) and FICA obligations. The savings average 30-40% for an individual.
What is pre-tax transit benefit?
The pre-tax transit and vanpool benefit is using the employee’s own salary before taxes to pay towards their transit or vanpool commute. For example, an employer offers employees a $20/month transit subsidy as an incentive to reduce the number of cars parking at their facility.