What Are Commuter Benefits?
There are two types of Commuter Benefit accounts:
1. Qualified Parking
2. Qualified Transportation
A Qualified Parking account allows the employee only, not their family members or dependents, to put aside tax-free dollars each month to pay for eligible parking expenses.
Eligible parking expenses include paying for parking at the employee’s place of work or paying for parking at the location from which they are taking mass transportation to work (e.g. lightrail station).
A Qualified Transportation account allows the employee only to put aside tax-free dollars each month to pay for eligible mass transit expenses.
Eligible mass transit expenses include bus, lightrail, or subway passes and vanpool (6 or more people)–any form of mass transit that the employee is using to commute to work.
By putting aside tax-free money to pay for parking and transit expenses instead of paying out of your normal bank account, you avoid losing your hard-earned money to taxes and have more to spend on the things you love.
Uber and Lyft
UberPOOL and Lyft Line rides also qualify as eligible transit expenses, though they must adhere to the IRS regulations for Qualified Transportation plans. IRS Publication 15-B states that a qualified commuter vehicle “is any highway vehicle that seats at least 6 adults (not including the driver).” If you pay for UberPOOL or Lyft Line using your personal debit or credit card and plan to file a claim to be reimbursed for the ride from your Qualified Transportation account, your assigned vehicle must have had at least 6 seats (not including the driver) for the ride to be considered an eligible expense. Individual Uber or Lyft rides (non-UberPOOL, non-Lyft Line) are not eligible transit expenses.
Wondering if Commuter Benefits could simplify your life?
Watch this short video to learn more!