The Commuter Tax Benefit program, as implemented in Connecticut and promoted by the Connecticut Department of Transportation, allows commuters the opportunity to pay for a portion of their commuting expenses with pre-tax dollars. This results in a tax savings for Connecticut commuters and a reduced taxable payroll for Connecticut employers.
As of January 2014, federal tax law allows commuters to set aside up to $130 per month of his/her salary before taxes to pay for transit or vanpool fares and $250 for qualified parking.
Commuter tax incentive programs are making a difference to thousands of employees throughout the state. In addition to monetary rewards, participants enjoy a less stressful commute and take satisfaction in knowing they are helping relieve congestion and reduce the environmental impact of driving alone to work.
The program is easy to set up and use and must be implemented by employers before employees can use it.