Parking and Transit Plans (Section 132)
Section 132(f) of the Internal Revenue Code allows qualified transportation expenses up to certain limits to not be taxed. Expenses including qualified parking, vanpooling, and transit passes can be reimbursed from this account. Irrevocable elections are not required, meaning the employee is permitted to make, revise and halt their elections.
This section of the tax code gives an employer a ready means to enhance their employee benefit offering and reduce both the employer's and employee's tax liability. If desired, the employer and employee can exclude this reimbursement from wages for FICA purposes.
Let Clark & Lavey assist you in contracting a qualified vendor to efficiently outsource the administration of this plan.
Overview
