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ARTICLE · 05 JANUARY 2016

Congress Gives Commuters A Christmas Present

The increase is particularly timely for commuters in New York City and Washington, DC, both of which, starting January 1, 2016, will require employers to offer employees the opportunity to receive tax-free commuter benefits.

United StatesEmployment and HR

On Friday, December 18, 2015, when President Obama signed the Protecting Americans from Tax Hikes (PATH) Act into law, one of the provisions included in the law made the monthly limit on qualified transportation benefits for public transportation equal to the monthly limit applicable to parking benefits. This means that, for 2016, instead of $130 per month as was recently announced by the IRS, the limit on commuting benefits that could be provided tax free will be nearly doubled, to $255 per month. (Technically, the limit for this year increased as well, to $250 per month, but since there's only a week left before the end of the year, that increase is fairly moot.) This increase is permanent – or as permanent as tax reductions are – unlike the temporary increase enacted in 2009.

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