There’s another opportunity to tell the IRS how you feel about parking taxes and transit benefit taxes, comments are due on Friday, June 7.
Buried in the Trump Tax Cuts was an esoteric change to how fringe benefits for commuters are taxed. Prior to the cuts, employers could provide free parking or free transit passes, up to a little more than $250 a month as a non-reported non-taxable fringe benefit. But after the tax cut went into effect, transit and parking benefits would be taxable to the employer at the corporate tax rate, even if the employer was a non-profit hospital, university, or charity. This could lead to many employers ending transit benefits. It might not be so bad if parking was really taxed the same way, but it isn’t.
Some employers, mostly in urban centers, pay third parties for employee parking, those employers would have to pay corporate taxes on the cost of parking, but employers with their own parking, or bundled parking in their suburban office park leases, would pay much less, or nothing, based on IRS guidance issued last year.
Having received many comments, the IRS is now asking the public to weigh in on what tax issues that we think should be their priority to work on this year.
This could really be a very damaging thing for transportation demand management programs and other efforts to reduce single-occupancy commutes. The Coalition for Smarter Transportation has a page with more information, read up a little and comment, your bus pass could depend on it.
Vickie wilder says
no transit benefits should not be taxed we have way too much tax as it is.