High Commuter Costs are Siphoning Money from Workers’ Wallets

Commuter Costs

The cost of work travel for commuters is high and hits them in time and in their wallets. According to Business Insider in 2019, workers spent between $2,000 and $5,000 annually on transportation. And as far as time spent, the U.S. Census Bureau calculated the average one-way commute went up to almost 30 minutes in 2019. 

Gas prices are averaging about $3.18 per gallon, and commuters have to factor in parking fees, taxi fares, or mass transit fees for buses, subways, or trains. Biking expenses can also be a factor.

In short, commuting is costly.

Taxpayers are not permitted to submit commuter expenses as part of their personal income tax write-offs. And the high cost of traveling back and forth to work every day has commuters looking for relief. Thankfully, the IRS acknowledges this burden on the workforce and has established a way for employees to get some help. However, the one caveat is that a commuter benefit plan must be offered by the workers’ employer.

When it comes to commuter benefit plans, there are a couple of options available.

One way is for employers to offset high commuter costs is to offer pre-paid transit passes to their workforce. These passes can be used on public or privately-owned mass transit systems, or for a business that transports people, like a vanpool. The bonus for employers is that they can save on payroll taxes because it does not count toward the employee’s gross income.

Another method for employers is to offer a reimbursement plan, which allows employees to set aside tax-free deductions from their paychecks and get reimbursed for qualified expenses. The monthly maximum reimbursements for varying transportation methods are:

Since employees are looking to make their dollars go farther to offset the high cost of commuting, they should check to see if their company offers a commuter benefits package. Transit plans can be a low cost solution to attracting and retaining top talent within a company’s workforce.

DataPath’s Summit platform can be a part of any employer’s benefits package, and it offers a variety of options:

  • Parking Expenses Conversion
  • Parking Expenses Reimbursement
  • Transit Pass and Vanpooling Expenses Conversion
  • Transit Pass and Vanpooling Expenses Reimbursement

With an integrated, secure online claims entry system, state-of-the-art mobile app, and convenient debit card, Summit is a comprehensive benefit solution with modern amenities.

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