Helping You Help Your Business

Encouraging your employees to share a ride will help them arrive on time, reduce their drive-time stress and ease congestion on the road and in your company’s parking lot. You’ll also be able to better recruit workers from outlying areas who may not want a long commute.

Companies that share the cost of a ride can reduce their payroll taxes. Employees can also reduce their taxes by using pre-tax dollars to pay their commuting costs.

Getting Started

Launching your company’s program is free and easy. We’ll analyze your firm’s current transportation situation through zip code density maps and employee transportation surveys. We’ll promote STAR services to employees with workshops and fairs. We’ll even offer discounts to qualified van riders.

METRO’s commuting solutions can cut your company’s parking expenses and enhance your employee benefit package with tax-free commuter assistance.

Questions? Email STAR@ridemetro.org.

Tax Benefits

Transportation Benefits

Transportation benefits give your organization an edge in today's tough competitive environment.

Offering transportation benefits to your employees is an effective way to recruit and retain top talent-a critical strategy in today's difficult business environment-and gives you a tax break, too.

The 1998 amendment to the Transportation Equity Act for the 21st Century (TEA-21) created financial incentives related to commuter benefits for employers and employees.

Here's how it works. You can pick one incentive or employ a combination, up to a limit of $260 per employee per month.

• Employer-paid transportation benefits. Employers can pay for each employee to commute via mass transit (bus, carpool or vanpool). Employees do not pay taxes on the value of this benefit and employers get a tax deduction for the expense. This offers significant savings over providing the equivalent dollar value to employees in the form of a salary increase.

• Pre-tax transportation benefits. Employers can allow employees to elect to exchange taxable salary for a tax-free bus, carpool or vanpool benefit. Employers save money overall since the amount exchanged is not subject to payroll taxes. Employees save money because this reduces the amount of taxable income.

• Shared-cost transportation benefits. Employers can share the cost of bus, carpool or vanpool costs with employees and everyone can receive valuable tax savings. Employers can provide a portion of the cost of taking transit or vanpooling as a tax-free benefit and allow the employee to exchange taxable salary for a tax-free bus, carpool or vanpool benefit.

• Parking cash-out. Employers can offer employees the option to "cash out" of their existing parking space. In other words, the company can offer the employee what it would pay for the parking space in the form of taxable salary or tax-free transportation benefits.

 

Be sure to contact an attorney or accountant for specific tax guidance.

If you need further information about METRO STAR, direct your email to STAR@ridemetro.org.