What is a Commuter Benefits Account?
A tax-advantaged payroll account used for eligible transit or parking expenses. And the IRS determines what are considered qualified expenses for a Commuter Account.
Who is eligible?
If commuter accounts are offered, employees are eligible.
Eligible expenses include:
Public Transportation: Buses, Trains, and Ferries.
Parking garages, mass transit facilities, etc.
Get to know more HERE
Some other examples of what you CAN’T pay for:
Tolls, taxis, and traditional ride sharing (Uber, Lyft, etc.) are not eligible.
- Uber Pool Commuter
- Lyft Line
Family members' expenses are not eligible.
How are commuter benefits accounts funded?
Commuter Accounts are typically payroll-funded. The funds build into the account each payroll cycle until it is funded at the contribution amount.
Monthly Contribution Limits: For the 2021 calendar year, an individual can contribute up to $270 per month/ per each benefit.
Plan Year: There is no plan year with a commuter benefits account, funds roll over continuously each month and do not expire.
Who is eligible to Contribute? Commuter benefits accounts can only be sponsored by employers and eligibility rules are set by each plan. Eligible employees may contribute up to the allowed maximum per month.
Who owns the account? A Commuter benefits account is owned and set up by the employer.
What are the funds that I have access to use? The account holder may only use the funds that are available in your account.
When can I change my contributions? Commuter benefits account users can change their contribution amount at any time, as long as it does not exceed the monthly allocation limit.
1. Runout period (date)- A runout period(date) is the amount of time after a company cancels its plan that an employee is able to submit claims for expenses incurred while the plan was active. Runout periods can be 0, 30, 60, or 90 days long and the company administrator decides how long the runout period will be. For example, if the plan is canceled on 6/30 and the administrator has selected a 30-day runout period. Employees can submit claims incurred up to 6/30 until 7/30.
2. Rollover- Funds in commuter accounts will roll over from month to month.
**Grace period does not apply to transit and parking accounts and since there is no grace period the employee cannot swipe their cards after the account end date.