U.S. Senator John Chafee
joined more than 150 tax, legal and human resources experts last week at
the Rhode Island Public Transit Authority’s Commuter Benefits
Conference.
The conference, held at the Providence Marriott on Tuesday, highlighted
legislation passed in June, 1998, called the Transportation Equity Act
of the 21st Century. The act improved transit and van pool benefits
under the Internal Revenue Code by increasing the amount of benefits
that can be excluded from income and by making the rules for providing
such benefits more flexible.
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Senator Chafee co-authored the legislation.
“Today’s event was a huge success for the employers who attended, their
employees and the environment,” said RIPTA General Manager Beverly
Scott. “The eagerness of the business community to support commuting
alternatives is critical to our state’s future — our economic viability,
environment, and quality of life in our communities.”
Beginning in January, federal tax law will make it more beneficial for
Rhode Island employers to pay a portion of their employees’ commuting
expenses. The law will allow employers to purchase Commuter Checks for
their employees and deduct the cost as a business expense.
Employees, who receive the Commuter Checks tax-free, can use them to pay
their commuting expenses on RIPTA, the MBTA, Amtrak, Bonanza, GATRA, an
Easy Street vanpool, or even on Interstate Navigation (the Block Island
Ferry).
Alternately, employees may set aside a portion of their salary, pre-tax,
and use the money to pay their qualified commuting expenses. Either way,
the employer pays no payroll taxes on the Commuter Checks or the money
the employees set aside.
Commuter Benefits are one of the most important ways employers can help
reduce traffic congestion and improve the environment, while giving
employees a tax-free benefit,” said Scott. “The program is a win-win
situation.”
