Thursday, December 2, 2010

Pre-Tax Transit Benefit In Danger

Unless Congress acts prior to December 31, transit parity under the Federal tax code will be gone. Currently up to $230 per month can be provided to an employee (either through payroll deduction of wages or as a fringe benefit) towards mass transit tax-free. That's the same amount as is exempt for a parking space. If Congress fails to act, it would revert to the pre-2008 ceiling of $120.

Currently, the most expensive farecard offered by Hampton Roads Transit (HRT) is the 30 Day MAX at $95. However, two things. First, it's the principle of the matter. If the Federal government wants to reduce the number of cars on the road, why give drivers a tax break nearly twice as large as transit riders? Second, should HRT pull it's fare review off the back burner in 2011, you might see that 30 Day MAX end up in the $120 range.

No comments: