Your commute just got more affordable. Thanks to the recently passed Budget Control Act of 2012 your employer can now offer you up to $240 per month in tax-free commuting benefits. That’s up from the current benefit of $125.00.
How do you take advantage of this tax break?
Talk to your employer about signing up for Commuter Choice Maryland program if they haven’t done so already. Once the program is in place your friends in Human Resources can take care of the rest.
Employers are able to choose from three distinctive pass distribution options:
• Each month your employer provides you up to $240 in tax-free commuter benefits in the form of a monthly pass or vouchers, or
• You purchase a pass or voucher and pay for it through a pre-tax salary deduction, or
• Combined option: your employer shares the cost of your monthly commute by transit or vanpool and you pay for the remaining costs using a pre-tax salary deduction.
Along with these benefits, you are able to participate in the Guaranteed Ride Home and your boss can participate in the Maryland Commuter Tax Credit program. The Guaranteed Ride Home program is designed for commuters who ride in a carpool or vanpool, take transit or walk or bike to get four free rides home from work annually in case of personal illness, family emergency or unscheduled overtime. The Commuter Tax Credit program allows employers who contribute to their employees’ monthly commuting costs to receive a 50% tax credit for the amount of benefit given to each employee.
Overall, these benefits are great. Thanks to the action by Congress we may see fewer cars on the road, cleaner air and have a little more money in our pockets!
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