This option lowers employees taxable income which saves them on federal income and payroll taxes. The employer saves on the payroll related taxes as well. HOK, Inc. in St. Louis is committed to offering transit benefits to its employees. Currently, employees are given the option to use a pre-payroll tax deduction for their monthly transit passes or ticket booklets. There has been an increase in the number of employees taking part in the program each month since its inception.
Some employers feel that sharing the fare is the fairest way to handle commute costs.
The tax law allows employee contributions to be free of payroll and income tax. The employer can deduct the cost of providing these benefits as a business expense. This option puts transit and vanpooling on an equal playing field with driving alone to work in St. Louis for companies. Many employers in St. Louis provide free parking to their employees, but currently offer no incentive for other modes of commuting. By providing a transit pass or the vanpool fare, the playing field becomes more level.