Employee/Employer Transit Benefit
What are transit beneﬁts? Under Section 132(f) of the Internal Revenue Code, employers are able to offer pre-tax beneﬁts to encourage employees to use public transportation to commute to work. Transit benefits are one of the fastest growing employee benefits – and a benefit your employees can use every day! Commuters are able to use pre-tax dollars to subsidize their commuting costs when using Laketran.
How to get started – There are 3 ways you can participate in Transit Benefits:
1. Employer pays for bus pass as a fully subsidized, tax-free benefit. Pass is paid for by the employer. Employer receives a tax deduction for the expense and saves on payroll related taxes. Employee receives benefit free of all payroll and income tax.
2. Employee pays for bus pass with pre-tax payroll deduction. Cost of bus pass is taken from pre-tax income thereby reducing taxable income. Employer and employee save because taxes are computed on the reduced amount of earnings.
3. Employee shares cost of pass with employer. The employer may pay a portion of the pass, then allow the employee to pay the balance with pre-tax or after-tax income.
Transit Benefits are a win-win! Employers and employees can save! Laketran is available to meet with your employees on an individual or group basis to show them how to use take Laketran from their home to work . These information sessions are free.
Get started today – Review our 2021 Transit Benefits Rack Card for more information. Ask your Human Resources Department if they offer transit beneﬁts. If they do not, have them contact Laketran at 440-350-1012.