12/17/2010: Public transportation riders rejoice as transit tax benefit is extended

For immediate release: December 17, 2010

Contact: Marta Lindsey

The federal benefit that allows employees to deduct up to $230 per month from their paychecks (before taxes) to apply towards public transportation commuting costs was extended for one year as part of the extension of the tax cut bill that President Obama signed today.

Congress increased the amount employees can deduct to $230 last year to match the deduction that car commuters get for parking as part of the stimulus package.  But the $230 transit tax benefit was about to expire. 

“It would have been completely unfair for drivers to continue to enjoy a $230 a month benefit while bus and train riders went back to a pre-tax benefit of just $120 a month,” said Marta Lindsey, Communications Director at TransForm, a nonprofit that advocates for better public transportation.

“No matter what you think of the tax cut bill, we can celebrate the fact that public transportation riders will continue to enjoy the same tax benefit that car drivers do,” said Lindsey.  “This tax benefit helps transit riders cope with rising commuting costs, plus it’s great to have incentives for people to use climate-friendly forms of transportation that reduce congestion and our dependence on oil.”

According to the Washington Times, commuters will save about $1,000 over the year thanks to the benefit.

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