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  1. #1
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    Bike Commuter Tax Benefit...Anyone getting this yet?

    Last year some tasty pork that benefits bicycle commuters got thrown in with the idiotic $700B bailout package.

    The bottom line is that if you ride to work a "substantial" amount, your employer has to give you $20 per month to put toward bicycle maintenance, storage, etc. Your employer gets to take the money off their corporate taxes.

    So, is anyone getting this yet? I am going to start pinging my employer and see how they want to handle it. I mean, I'd be happy with $20 gift certificates to the LBS if they want to be guaranteed you are using it for bike stuff. That's totally fine with me...it helps support the local economy.

    What say you?

    Here are the gory details:
    http://www.irs.gov/publications/p15b...link1000101852

    Shorter version pasted from http://www.bikeleague.org/news/100708adv.php

    SEC. 211. TRANSPORTATION FRINGE BENEFIT TO BICYCLE COMMUTERS.

    (a) In General- Paragraph (1) of section 132(f) is amended by adding at the end the following:

    `(D) Any qualified bicycle commuting reimbursement.'.

    (b) Limitation on Exclusion- Paragraph (2) of section 132(f) is amended by striking `and' at the end of subparagraph (A), by striking the period at the end of subparagraph (B) and inserting `, and', and by adding at the end the following new subparagraph:

    `(C) the applicable annual limitation in the case of any qualified bicycle commuting reimbursement.'.

    (c) Definitions- Paragraph (5) of section 132(f) is amended by adding at the end the following:

    `(F) DEFINITIONS RELATED TO BICYCLE COMMUTING REIMBURSEMENT-

    `(i) QUALIFIED BICYCLE COMMUTING REIMBURSEMENT- The term `qualified bicycle commuting reimbursement' means, with respect to any calendar year, any employer reimbursement during the 15-month period beginning with the first day of such calendar year for reasonable expenses incurred by the employee during such calendar year for the purchase of a bicycle and bicycle improvements, repair, and storage, if such bicycle is regularly used for travel between the employee's residence and place of employment.

    `(ii) APPLICABLE ANNUAL LIMITATION- The term `applicable annual limitation' means, with respect to any employee for any calendar year, the product of $20 multiplied by the number of qualified bicycle commuting months during such year.

    `(iii) QUALIFIED BICYCLE COMMUTING MONTH- The term `qualified bicycle commuting month' means, with respect to any employee, any month during which such employee--

    `(I) regularly uses the bicycle for a substantial portion of the travel between the employee's residence and place of employment, and

    `(II) does not receive any benefit described in subparagraph (A), (B), or (C) of paragraph (1).'.

    (d) Constructive Receipt of Benefit- Paragraph (4) of section 132(f) is amended by inserting `(other than a qualified bicycle commuting reimbursement)' after `qualified transportation fringe'.

    (e) Effective Date- The amendments made by this section shall apply to taxable years beginning after December 31, 2008.

  2. #2
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    Reputation: BIGfatED's Avatar
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    I knew nothing of this said tax. This is a nation wide agreement? What is the best way to approach my employer about this information?

    Thanks for your knowledge.

    BFE

  3. #3
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    I never heard anything about this either, very interesting though. Someone needs to get the word out there.

  4. #4
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    Check with your employer too, they may already have a program in place. Especially if you're a government employee. I work for the county and have participated in their commute assistance program for years. $20 a month for walking or biking to work. You can also get a subsidy for carpooling or taking public transit.
    R.I.P. Ronnie James Dio ~ July 10, 1942 Ė May 16, 2010

  5. #5
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    Reputation: Jerk_Chicken's Avatar
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    Unless the employer is getting more than the $20, I wouldn't be surprised if they just put the money in your hand to shut you up so they don't have to do the paperwork.

  6. #6
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    Hopes dashed...

    I was excited to see this so I immediately sent an email to our HR and got this response:

    "I havenít heard of this before, but upon reviewing the IRS publication I think this is only applicable if the employer elects to provide this type of fringe benefit to employees Ė it isnít an automatic entitlement to employees. For example, company policy allows for Adoption Assistance, if utilized it would be taxed as a fringe benefit. The company also provides car allowances to sales people and this is considered a fringe benefit and is taxable.

    However, company policy does not provide a benefit to commuters Ė through transit passes, parking, bicycle commuting or commuter vehicles. With our current cost savings initiative, adding additional fringe benefits is not an option."


    I suspect that other companies would respond similarly given the recession. So what's the point of this then? It gives permission for companies to give commuters $20? I don't get it.

  7. #7
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    Quote Originally Posted by RAMJET
    I was excited to see this so I immediately sent an email to our HR and got this response:

    "I havenít heard of this before, but upon reviewing the IRS publication I think this is only applicable if the employer elects to provide this type of fringe benefit to employees Ė it isnít an automatic entitlement to employees. For example, company policy allows for Adoption Assistance, if utilized it would be taxed as a fringe benefit. The company also provides car allowances to sales people and this is considered a fringe benefit and is taxable.

    However, company policy does not provide a benefit to commuters Ė through transit passes, parking, bicycle commuting or commuter vehicles. With our current cost savings initiative, adding additional fringe benefits is not an option."


    I suspect that other companies would respond similarly given the recession. So what's the point of this then? It gives permission for companies to give commuters $20? I don't get it.
    I just got something similar.

    It sounds somewhat voluntary which in my company equates to "nonexistent."

    Sorry to tie up the boards with a waste of bandwidth.

  8. #8
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    The unfortunate thing about this tax break is that it's completely voluntary.

    The hardest part about this is getting your employer (especially if you work for a big retail giant) to get on board with this.

    I'm going to give it a shot with my HR director. I'll keep you updated.

  9. #9
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    I just emailed my HR dept to see, although I am sure it will get shot down faster than the U2 spy plane.
    "Donuts. Is there anything they can't do?"

  10. #10
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    yeah right...ive emailed my hr dept 7 times....they are still "looking into it"
    Let The Good Times Roll

  11. #11
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    Reputation: PscyclePath's Avatar
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    Quote Originally Posted by RAMJET
    I suspect that other companies would respond similarly given the recession. So what's the point of this then? It gives permission for companies to give commuters $20? I don't get it.
    The so-called Bicycle Commuter Act allows an employer to deduct $20 per bike-commuting employee per month if they provide some sort of commuting benefit. This absolutely does not mean that the employer will be handing each of us an extra $20 bill per month just for biking in eight or nine days per week, it simply means that if they incur expenses supporting commuters, such as putting in bike racks, showers, bike paths, etc., then they can deduct $20 per biker per month from their tax obligation. Budgeting $20 per biker per month to defray their commuting expenses is an option, however it's unlikely even in these more bike-friendly times.

    20 bucks is pretty much a token amount... if you commute via public transportation, there's another tax benefit of $120 per month; the kicker is that you can only claim one of the two options, $120 for the bus or Metro, or $20 bucks for your bike, but not both at the same time. Go figure...
    Ride a mountain bike... you will not regret it if you live.
    [SIZE="1"](with apologies to Mark Twain & The Taming of the Bicycle)[/SIZE]

  12. #12
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    Here is the response I got from HR:

    "Thanks for doing the research on this. Since we donít reimburse employees for the purchase of a bicycle or maintenance/repairs, I doubt we would qualify for the bicycle commuter exclusion."

    Bummer.
    "Donuts. Is there anything they can't do?"

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