NJ TRANSIT Logo Commuter Tax Benefits Save up to $900 on Your Commute Governor Phil Murphy signed a bill into law requiring New Jersey employers of at least 20 employees to offer a pre-tax transportation fringe benefit to employees (who are not currently in a collective bargaining agreement) beginning March 1, 2020. The Federal Government allows employees to set aside a certain portion of pre-tax wages, which can be used for your mass transit commuting costs and parking while reducing your federal taxable income. The Federal Government currently allows a pre-tax commuter benefit of $270 per month. That means you could save up to $900/year by not paying federal income tax on that salary. Save Even More on Parking If you need to pay for parking in order to make your transit connection, the parking fees can be funded with pre-tax dollars up to an additional $270 per month. What Do You Need to Do? Check with your employer to see if they already offer a commuter tax benefit. You may want to start with the Benefits Department, your Payroll contact or Human Resources Department. They will help you figure out if the benefit is already offered to employees. Keep in mind: the only way to access pre-tax salary is through your employer. Once you take home your paycheck, you have paid income tax on that salary. The pre-tax transit benefit is not a year-end deduction; it consists of payroll deductions throughout the year. What Do Employers Need to Do? To take advantage of these tax savings, your employer needs to opt-in to either the NJ TRANSIT Bulk Sales program or one of the programs offered by a third party provider, like Beniversal/eTRAC, Commuter Benefit Solutions, RideECO (Delaware Valley Regional Planning Commission), TotalBen, TranBen, or TransitChek by WageWorks. In addition to these programs, payroll service companies like ADP, offer a transit pre-tax benefit option. A common name for the benefit is "commuter tax benefit". TaxFree commuter benefits can be structured as an employee-funded tax-free payroll deduction; as an employer-funded benefit; or the costs can be shared by employer and employee. The benefit can be delivered in the form of transit provider-specific passes or universally accepted vouchers and debit cards. Let NJ TRANSIT help you through the process and provide the information you need to explore the options, programs and benefits of pre-tax transit. Contact the NJ TRANSIT Bulk Sales program at 973-491-7288, or contact any of our partner providers listed above. Employers see what NJ TRANSIT is doing to ensure your employees can get back to the office. chevron right circle What is the pre-tax transit benefit? The Internal Revenue Code allows employees to use pre-tax salary towards their mass transit commuting costs. It is IRS Code, section 132(f) Qualified Transportation Fringe. chevron right circle How much pre-tax salary can be used? chevron right circle How does this save money? chevron right circle Is the pre-tax benefit the same as a flexible spending plan? chevron right circle Is this something that can be claimed on your taxes at the end of the year? chevron right circle Is this a tax write-off? chevron right circle Is the pre-tax transit benefit the same as a transit subsidy? chevron right circle Can an employee use both the pre-tax transit and parking benefit? chevron right circle Is pre-tax transit available if you're self-employed? chevron right circle Is there a minimum number of participants to offer a pre-tax benefit? chevron right circle Do you recommend a program? chevron right circle What do you do if you have employees traveling on all different transit systems in the area? chevron right circle Are there fees associated with the programs? chevron right circle Is there a minimum for bulk orders from NJ TRANSIT? chevron right circle Is there a deadline to place bulk orders from NJ TRANSIT? chevron right circle Are vanpools eligible for the pre-tax benefit? chevron right circle I use E-ZPass. Can my tolls be paid for with the pre-tax benefit? Can I pay for fuel with the pre-tax benefit? NJ TRANSIT Logo SUBSCRIBE NOW MOBILE APP SERVICES TICKETS STATUS ABOUT CONTACT Customer Service Feedback Lost & Found Media Relations Open Public Records Act (OPRA) Board of Directors Advertise with us! NJ TRANSIT on Facebook NJ TRANSIT on Twitter NJ TRANSIT on YouTube NJ TRANSIT on Instagram NJ TRANSIT on LinkedIn SIGN UP FOR UPDATES Privacy Terms Of Use Sitemap 2021 © NJ TRANSIT All Rights Reserved. To give you the best possible experience, our website uses cookies. You can review our privacy policy to find out more about the cookies we use and how to adjust your browser settings to block cookies. If you close this box or continue browsing our website, you accept our use of cookies. Accept