Commuter Choice is a provision of the Internal Revenue Code [(26 USC 132(f)] that permits an employer to pay for an employee’s cost of commuting to work, in other than a single occupancy vehicle. Basically, employers get a tax break for getting their employees to work using public transportation.

Some FAQs:

Why is there a Commuter Choice Program?

The program is designed to improve air quality, reduce traffic congestion, and conserve energy by encouraging employees to commute by means other than single occupancy motor vehicles.

How does the program operate?

Under Section 132 of the Internal Revenue Code (IRC), an employer may provide up to $65 per month to those employees who commute to work by transit or vanpool. The employer can deduct these costs as business expenses and the employees do not report the subsidy as income for tax purposes. The subsidy is considered a "qualified transportation fringe" benefit.

What constitutes the "benefit"?

An employer may provide cash reimbursement to an employee for public transit or vanpool transportation costs for trips taken between his/her home and place of employment. Such reimbursement is only permitted if a voucher or similar item which may be exchanged only for a transit or vanpool pass is not readily available. Cash reimbursement does not include cash advances. A transit pass includes any pass, token, farecard, voucher, or similar item entitling a person to transportation on mass transit facilities or provided by a vanpool.

For more FAQs and information, click here: www.fta.dot.gov.

 

Want to learn about how Commuter Choice can help your employees get to work? Contact Valerie Ragland at valerie.ragland@veoliatransdev.com or give her a call at 912-629-3924.