Commuting Subsidy Maximum Rises

The IRS has raised the tax-free limit on public transit subsidies from $105 to $110 a month, potentially triggering an increase in the subsidies that many agencies pay their employees to commute via public transport, van pools and similar arrangements. In some cases, agencies provide a direct payment, while others allow employees to take an amount from their pay as a pre-tax benefit. Not all agencies use the authority, however, and even those that do won’t necessarily raise their subsidies automatically. In some cases transit subsidy policy is subject to union contract provisions.