See the attached Vanpool Tip Sheet, at the bottom of this page, for more information on starting a new vanpool.
For a low cost, employers can help employees cover the cost of vanpooling. Your company can deduct up to $245 per month for vanpooling costs from employee paychecks before taxes. Providing these commute benefits could qualify an employer for the Best Workplaces for Commuters program, which recognizes employers who voluntarily meet the National Standard of Excellence in employer-provided commuter benefits.
Enhanced Employee Benefit Package
While employees can determine their own method of commute, providing information about transportation options such as the Drive Less Connect program increases employee ties with the workplace. By endorsing commute options such as vanpooling, employers effectively show employees that the company cares about how they get to and from work each day. In addition to any direct benefits the employer provides, the employees who take advantage of transportation options will feel the workplace is working to benefit their lives. This helps with employee retention and recruitment, while increasing the accessibility of your workplace.
Employers who wish to provide vanpool assistance to their employees can take advantage of the financial incentives offered at both the Federal and State levels in the form of tax deductions and credits.
Employers can deduct the cost of any direct payments toward employee vanpool costs as a business expense, saving on Federal and State taxes.
Your company can deduct up to $245 per month for vanpooling costs from employee paychecks before taxes. As a result, your company saves on payroll taxes and your employees don't pay income taxes on those costs. Or you can combine a direct payment and a pre-tax deduction, in any proportion, up to a total of $245 per month for both.
Providing benefits in lieu of salary will not increase costs to employers; it will reduce their payroll costs since payroll taxes do not apply to these benefits. Pre-tax payroll deductions are referenced in IRC Section 132 (f), as amended by TEA-21, Title IX, Section 910. Also check with your tax advisor.
Benefits for Federal Employees:
All Federal employees are eligible for transit/vanpool benefits. They can get a form from their HR office and can receive up to $245 per month to use for transit passes or vanpool fares. It comes in the form of a "RideCheck" voucher which should be accepted by transit agencies and Valley Vanpool vendors.
Reserved vanpool parking spaces in prime locations help the vanpools get noticed and shows employees that the company cares how they get to work.
Talk to your HR or finance department, check out IRS(IRC Section 132(f) or call us at 541-924-8480.We're happy to help.
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