MassCommute.com

The Spring 2010 MassCommute Newsletter is now available!

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New! Check out our 2009 FastStats to see all the services TMAs have been providing!

Tax Free Benefits for Bike Commuters

The Emergency Economic Stabilization Act of 2008 : H.R. 1424: (bailout) bill signed into law by President Bush on October 3, 2008 includes expanding qualified transportation fringe benefits (Section 132(f) ) to allow up to $20.00 per month for bicycle commuters. Bicycle benefits will take effect in January of 2009.

This benefit means that employers may provide employees with up to $20 in tax-free bicycle benefits per month, up to $240 per calendar year, for reasonable expenses incurred by the employee during the calendar year for the purchase of a bicycle and bicycle improvements, repair, and storage if the bicycle is regularly used by the employee to travel between the employees residence and place of employment. For the full text view SEC. 211. TRANSPORTATION FRINGE BENEFIT FOR BICYCLE COMMUTERS.

Tax information for commuters:

Massachusetts Commuter Deduction

A deduction is allowed for certain amounts paid by an individual for tolls paid for through a FastLane account or for weekly or monthly transit commuter passes for MBTA transit or commuter rail, not including amounts reimbursed or otherwise deductible. In the case of a single person or a married person filing a separate return or a head of household filing a separate return, this deduction applies only to the portion of such expended amount that exceeds $150, and the total amount deducted cannot exceed $750. In the case of a married couple filing a joint return, this deduction applies only to the portion of such amount expended by each individual that exceeds $150, and the total amount deducted cannot exceed $750 for each individual. For a copy of the worksheet to calculate the commuter deduction please click here.

Federal Tax Information:

Transportation Fringe Benefit for Transit and Vanpool Commuters!

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. Also check out IRS Taxable Fringe Benefit Guide for more details about Commuter Tax Benefits.

The American Recovery and Reinvestment Act of 2009 (stimulus bill) includes an increase in the transportation fringe benefit (IRS section 132f) from $120/month to reach parity with the parking benefit at $230/month. As described the benefit is effectively immediately, which could enable you to increase the pre-tax benefit for employees February passes – although this might not work for most of you with complex payroll systems.

"PART VI-PARITY FOR TRANSPORTATION
2 FRINGE BENEFITS
3 SEC. 1151. INCREASED EXCLUSION AMOUNT FOR COMMUTER TRANSIT BENEFITS AND TRANSIT PASSES.
(a) IN GENERAL.-Paragraph (2) of section 132(f) is amended by adding at the end the following sentence:
''In the case of any month beginning on or after the date of the enactment of this sentence and before January 1, 2011, subparagraph (A) shall be applied as if the dollar amount therein were the same as the dollar amount in effect for such month under subparagraph (B).''.
(b) EFFECTIVE DATE.-The amendment made by this section shall apply to months beginning on or after the date of the enactment of this"

MassCommute is a group of Massachusetts Transportation Management Associations (TMAs), which leverage public and private funds to increase the use of ridesharing and other commuting alternatives that reduce traffic congestion and imporve air quality across the state. As membership organizations, TMAs operate in specific geographic areas to influence transportation policies and create programs for TMA member employers, institutions, governmental organizations, and commerical property owners. More than 250 businesses, schools, and organizations belong to the thirteen TMAs that provide services for more than 300,000 commuters in urban and suburban areas.