TransitCenter Applauds Senate Passage of Measure to Boost Monthly Savings for Mass Transit Commuters

Measure to enable consumers to save up to $1,000 annually on their commutes

NEW YORK, Feb. 11 /PRNewswire-USNewswire/ -- Legislation passed by the U.S. Senate yesterday is slated to increase the monthly cap on pre-tax income that employees can use to pay for their mass transit commutes from $120 to $230, according to TransitCenter, Inc., a nonprofit that promotes mass transit use in order to reduce traffic congestion and improve air quality. "Once the bill becomes law, it will mark a major victory for commuters seeking relief from the recession and chart a new course for the future of mass transit," said Larry Filler, president and CEO of TransitCenter and a leading advocate for commuter benefits for more than 20 years. "We congratulate the Senate on the passage of this bill and extend our gratitude to Senator Schumer, who initiated the legislation, and his cosponsors."

Previously, employers were allowed under Section 132(f) of the Internal Revenue Service (IRS) Code to let their employees use up to $120 per month of their pre-tax income to pay for their transit or vanpool commuting expenses and up to $230 per month for commuter parking. Yesterday's legislation, included as part of the American Recovery and Reinvestment Act, amends the IRS Code to set the monthly tax-free contribution limit for both transit/vanpool to a maximum of $230 per month.

"This measure would enable commuters to save up to an additional $1,000 a year on their commuting expenses, reduce traffic and contribute to cleaner air," noted Filler.

TransitCenter introduced TransitChek(R), the nation's first commuter benefits program, in 1987, which gave employers the ability to allow employees to pay for their transit commuting costs using tax-free dollars, encouraging greater use of mass transit to reduce traffic congestion and protect the environment.

About Tax-Free Commuter Benefits

Since 1987, employers have been able to offer employees a tax-free benefit for commuting by transit and eligible vanpools or to pay for commuter parking primarily at transit or ridesharing locations under IRS tax code section 132(f). Today, the benefit provides tax savings for both employers and employees. Tax-free commuter benefits can be structured as an employee-funded tax-free payroll deduction; as an employer-funded benefit; or the costs can be shared by employer and employee. The benefit can be delivered in the form of transit provider-specific passes, universally accepted vouchers and terminal-restricted debit cards, or through a reimbursement model under specific conditions defined by the IRS. Current IRS limits allow for participants to set aside up to $120 a month tax-free to pay for transit and vanpool commuting costs, and up to $230 for commuter parking.

About TransitCenter

Over 20 years ago, TransitCenter was created to develop innovative ways to encourage greater use of mass transit in order to reduce traffic congestion and improve air quality. Today, TransitCenter continues to be focused on these objectives, along with helping employers and employees cope with rising gas and commuting costs by providing transit incentives, information and assistance. TransitCenter also works closely with businesses, transit operators, commuter groups, regional development agencies and government agencies to improve their understanding of the importance of transit in making communities better places to work and live.

As part of this mission, in 1987 TransitCenter launched TransitChek(R), the first commuter benefits program in the nation, which has made commuting a more affordable option for commuters across the country.