For a second consecutive year, the IRS has approved an increase in the monthly allowable tax-free amount toward commuter benefits, raising the maximum from $110 to $115 for transit costs. The change became effective Jan. 1.
The IRS reportedly raised the commuter benefit amount to adjust for inflation based on the Department of Labor’s Consumer Price Index. However, the $5 may offer little comfort to many public transit riders. With fuel costs skyrocketing in recent years, transportation agencies have hiked their fares to compensate – by almost double in some cases – but transit benefits haven’t nearly kept the pace.
Help could be on the way. Bills introduced both in the House of Representatives and the Senate last year would revise the laws to increase the monthly transit and vanpool limit to $200 per month, if passed. Both, as of this writing, were assigned to committees for review.
In a press release, the American Public Transportation Association (APTA) praised the $5 hike as a win for commuters and the environment. The organization cited a recent study which claimed riding public transportation could reduce a commuter’s daily carbon emissions by 20 pounds.