Transit Benefits Parity

Did you catch the little detail in all the PATH (Protecting Americans from Tax Hikes Act) documentation about the parity between transit benefits and parking benefits?  Yes, that’s right – it was made retroactive to January 1, 2015!

If you have not made this adjustment yet, please make sure you do it soon!  There are a few steps involved.  First, make sure that you can identify all your employees’ pre- and post-tax transit benefits  by month.  Then create a macro or statement in EXCEL (or other calculation program) to identify the difference between $130 (the original monthly amount) and $250 (the parity-adjusted amount for 2015).  This will affect only those who had pre-and post-tax deductions, of course.

You’ll need to arrive at: a revised pre-tax deduction amount for each month and the year; a refund amount for any Social Security and Medicare deducted based on the original post-tax deductions; revised Federal taxable wages, and state taxable wages, if applicable.  Then you’ll be able to create new W-2 Forms or create W-2C’s for your employees.

This is not a small task, but with a clear idea of all the steps, it can be done.

Need help?  We can assist.  Contact us for a lifeline!


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