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Commuter Transit Benefit

The Transportation Equity Act is a provision of the Internal Revenue Code that allows favorable tax treatment for employers that offer commuting options to their employees. Under Section 132(f) of the Internal Revenue Code, an employer can provide up to $120 per month to those employees who commute by public transit. The employer can deduct these costs as business expenses and the employees do not report the subsidy as income for tax purposes. In addition, employers are able to offer the cost of a transit pass to employees on a pre-tax basis. Advantages to employers include both a tax deduction for the expense, and savings on payroll taxes, FICA, disability insurance and payments into 401(k) plans.

Employees- How the Transit Benefit Program Benefits You:

  • Ride for less with an employer subsidy – If you work for a company that offers the commuter transit benefits, your cost of a JATRAN Monthly or Weekly Pass will be reduced. You’ll be able to get to and from work for a fraction of your current cost.
  • Save even without an employer subsidy – Even if your employer doesn’t offer a transportation subsidy, they can offer the cost of a JATRAN Monthly or Weekly Pass on a pre-tax basis. This will reduce your taxable income. The transportation will cost you less since it is being paid for with pre-tax dollars.
  • Reduce auto maintenance and insurance costs –  Riding JATRAN can help you save thousands of dollars a year in gasoline and auto maintenance expenses, if you drive. Plus, commuting on JATRAN can even lower auto insurance rates, because the insured vehicle is driven fewer miles.
  • Save on parking – Riding JATRAN every day eliminates your parking expense and hassle.
  • Avoid Driving in Traffic – JATRAN speed and intervals are fixed. There is no "rush hour traffic." It glides along, getting you to work and home on time, regardless of traffic congestion on the roads. And JATRAN riders won't need to worry about driving in bumper-to-bumper gridlock.
  • Get more time to yourself – Ultimately, there’s the benefit of simply having more time to yourself. Use the time to suit your personal needs.

Employers - How the Transit Benefit Program Benefits You: 

  • Tax savings without an employer subsidy – You can save thousands of dollars in payroll taxes by offering the cost of public transportation on a pre-tax basis.
  • Deductions with an employer subsidy – Under Section 132 (f) of the Internal Revenue Code, you can provide up to $120 per month to an employee who commutes by transit or vanpool. You can then deduct these transportation subsidies as a business expense.
  • Parking savings – The more employees who commute, the less you need to spend to build, maintain or lease parking. These savings really add up for employers with space constraint problems and growing business campuses.
  • Reduce employee absenteeism and tardiness – Employees who ride JATRAN won’t be plagued with automobile maintenance and breakdown problems. They have a sure ride to work every day, free of traffic congestion.
  • Increase employee retention – Employers with better benefits keep better employees. You will realize increased productivity and reduced costs due to employee turnover, while reducing your employees’ cost of transportation.