Mass transit commuters' tax breaks falling
The amount of income that commuters who use mass transit will be eligible to shelter from taxes to pay their fares drops on Jan. 1 to $125 a month from the current $230 a month, while the tax-free parking benefit for drivers will increase from $230 to $240 a month, officials said Thursday.
The steep reduction in the transit provision is due to Congress’ failure to renew the higher limit in the Commuter Benefits Equity Act, officials said, adding that they are hopeful lawmakers will approve a higher limit sometime in 2012.
Regional Transportation Authority Executive Director Joseph Costello called the pending cut in pre-tax transit benefit dollars “a clear inequity that is not good for our cities.”
The cut in benefits will have a similar effect as a fare increase because riders whose employers participate in the transit benefits program will only be able to shield a maximum of $1,500 in income from taxes in 2012, down from $2,760 this year.
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