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Limited Time Only – If your Employer offers the Bicycle Commuter Benefit Use it Now
If your employer currently offers the Bicycle Commuter Benefit, the safest thing to do is to submit all documentation and pay out all reimbursements by December 31 2017.
Six weeks ago, the Senate Finance Committee released their version of the Tax Cut and Jobs Act. In their initial report, in the name of simplifying the tax code, they chose to suspend the Bicycle Commuter Benefit from 12/31/2017 until January 1, 2026.
Over the last six weeks, we’ve had over 2,000 individual actions aimed at educating Senators and Representatives about the folly of eliminating the Bicycle Commuter Benefit while not substantially changing the car parking benefit, which accounts for 85% of government subsidies for commuting. Unfortunately, those actions did not move Congress to either reinstate the Bicycle Commuter Benefit or alter the car parking benefit.
The Tax Cut and Jobs Act does two things to commuter benefits:
- It suspends the Bicycle Commuter Benefit from 12/31/2017 until January 1, 2026; and
- It eliminates the ability of employers to deduct the cost of providing subsidized commuting to employees, reducing the employer’s taxable income, as part of cutting the business tax rate from 35% to 21%.
The Tax Cut and Jobs Act did not:
- Do anything to expand the availability of commuter benefits – which are currently 7 times more likely to be offered to workers in the highest 10% of income than workers in the lowest 10% on income;
- Do anything to provide incentives to modes of transportation that reduce congestion, such as walking, biking, telework, or carpooling; and
- Do anything that affects employees who put their pre-tax earnings towards a commuter benefit.