December 13, 2010
“Saving Your Transit Benefits… and Your Trains”
Don’t look now, but Congress is about to give motoring commuters a big tax break and take one away from riders of mass transit.
Under current federal law, commuters can deduct up to $230 a month from their pre-tax paychecks to pay for the trips to and from work. That deduction can cover bus / rail tickets via programs like TransitChek or pay their parking expenses. But unless Congress acts by the end of the year, the mass transit commuter’s benefit will be cut to $120 per month while the motoring commuter keeps the full benefit. Huh?
Cutting this pre-tax benefit would hurt low income workers the most because they often have no car and must rely on bus and train. At a time when we’re trying to reduce highway congestion and improve air quality, penalizing mass transit riders and rewarding users of autos makes no sense.
But these tax benefits are for more than commuters. Employers can save 10% on payroll taxes if they sign up employees for the program. According to MetroPool, over 100 businesses in
hiring over 34,000 workers participate in the commuter pre-tax program. Fairfield County
Here’s an example of the savings: Let’s say you ride from
to NYC, and then take the subway. With a monthly rail pass at $308 and monthly MetroCard at $45, you’d spend $4,200 a year just to get to and from work. The current commuter benefit defrays 68% of this cost, saving you $1,355 a year in taxes. Fairfield
But again, this tax break will be cut in half if Congress doesn’t act quickly.
If this bill doesn’t come out of Committee and get approved by December 31st 2010, reduced tax benefits for rail and bus riders may incentivize some commuters to get back in their cars. According to TransitCenter Inc., a drop in the transit benefit will reduce ridership by as much as 9% among commuter benefit users. And you know what that means for traffic.
What can you do? You need to contact your Congressman and ask him or her to support the bill. Also, ask your employer’s Human Resources office why they don’t offer these pre-tax benefits, reminding them it’s in their interest as well as yours.
Finally, get in touch with the TSTC (
Tri-State Transportation Campaign) at www.tstc.org and support their strong advocacy on this and so many other transportation issues. They are among commuters’ greatest allies.
And while you’re in a mood to contact your elected officials, don’t forget to call or e-mail your State Rep and Senator. We need their help to defeat Governor Rell’s recent senseless call to shut down trains on the New Canaan,
Waterbury and branch lines. Danbury
Just weeks ago I was hailing Governor Rell for her leadership and support of mass transit. Then she turns around and tries to save $5 million a year by stranding 4,300 daily riders of those lines. And this, after spending $60 million in federal funds to put signals on the
branch, only to suggest it be shut down? Danbury
Days after her call to close down the trains, she literally “back-tracked”. Her office called me to say she didn’t mean it, that she was trying to get attention of lawmakers and blaming her budget folks at OPM for putting rail cuts on the list of possible cost savings.
Shame on her for frightening commuters and using them as a political lever. By admitting she was “crying wolf”, who will take her seriously on the next crisis?