[vc_row type=”in_container” full_screen_row_position=”middle” scene_position=”center” text_color=”dark” text_align=”left” overlay_strength=”0.3″ shape_divider_position=”bottom” bg_image_animation=”none”][vc_column column_padding=”no-extra-padding” column_padding_position=”all” background_color_opacity=”1″ background_hover_color_opacity=”1″ column_link_target=”_self” column_shadow=”none” column_border_radius=”none” width=”1/1″ tablet_width_inherit=”default” tablet_text_alignment=”default” phone_text_alignment=”default” column_border_width=”none” column_border_style=”solid” bg_image_animation=”none”][vc_column_text]You have the best and worst of it if you are an NYC commuter. By one measure, you have the worst one-way commute time in the United States: about 34 minutes.
However, you’ve had a commuter benefits law on the books since January 2016. That law mandates for-profit and nonprofit employers with 20 or more full-time employees to provide the option of using pre-tax income to purchase commuter benefits.
The law allows commuters to set aside up to $270 tax-free for their commuting costs from paychecks each month. Employers save because of reduced payroll costs. The way it works best for employers is to get maximum participation. The more employees who enroll, the more employers will save.
And you have the choice of using those tax-free benefits at more than 100 providers in many different means of transportation, including subway, bus, rail, paratransit, ferry, ridesharing and vanpool.
NYC: Home of the commuter
It would make sense that NYC would have a commuter benefits law since there’s an abundance of commuters. The Census Bureau estimated 1.6 million people commute into Manhattan on a workday. It’s estimated the NYC rail systems serve more 150 million commuters annually in the tri-state region.
Commuters in most other locations across the country do not have local laws that mandate commuter savings. As of September 2018, only Washington, D.C., San Francisco and some surrounding areas in the Bay Area have similar municipal laws on the books. A number of states allow for federal and state income and payroll taxes, but there is no mandate.
The NYC law closely mirrors the IRS fringe benefit guidelines concerning reimbursement. However, parking is not covered under the NYC local law, though parkers can still save by via the federal commuter benefits law.
How much can you save in NYC?
Let say you spend $110 commuting on the subway or bus every month ($5.50 x 20 working days). If you are single and make $78,000 per year, you can save $484. There are other variables involved, but that’s one option. You can see your savings no matter what state you live in by entering your information into our savings calculator.
Another way to look at it is by the tax rate. New York City says an employee with a tax rate of 35% can set aside $200 per month for commuting costs. Under this scenario, they’ll save $70 a month, or a total of $840 a year.
It might not be easy to commute in New York, but at least you have the law on your side. If your business is interested in commuter benefits, contact Commuter Benefit Solutions to review your options.
If you want to learn more about the New York City Ordinance, download the toolkit below:[/vc_column_text][nectar_btn size=”large” open_new_tab=”true” button_style=”regular” button_color_2=”Accent-Color” icon_family=”none” url=”https://go.commuterbenefits.com/NYCOrdinanceToolkit_Blog?utm_source=blog_post&utm_medium=CTA&utm_campaign=NYC_Ordinance_Toolkit” text=”NYC Ordinance Toolkit”][/vc_column][/vc_row]