Bipartisan legislation recently reintroduced in the U.S. House of Representatives would encourage employers to subsidize transit for their employees.
The Supporting Transit Commutes Act would allow transit subsidies to be fully tax deductible to encourage employers to offer subsidies instead of pre-tax benefits. If an employer offers only a pre-tax option, they are eligible to deduct 50 percent of the amount withheld.
Employers did not pay corporate or payroll taxes on transit benefits prior to 2018. Tax law changes in 2018 required employers to be taxed for providing employees with transit benefits.
U.S. Reps. Jake Auchincloss (D-MA) and Mike Lawler (R-NY) re-introduced the bill. It has the support of the Amalgamated Transit Union, the Association for Commuter Transportation, the Community Transportation Association of America, the National Association of Counties, the Society for Human Resource Management, and the Transport Workers Union.
“Investments in transit and walkability make for cleaner, more vibrant downtowns and better commutes for riders,” Auchincloss said. “The goal of the Supporting Transit Commutes Act is simple: increase transit ridership. Legislation like this can help kick start a virtuous cycle of more riders, reduced traffic, and enhanced investment in walkable downtowns.”
The bill has been referred to the House Committee on Ways and Means.