Transportation Fringe Benefits for 2013

Your take-home pay this year is smaller because of the expiration of the payroll tax holiday. But you can increase your spendable dollars by taking advantage of certain fringe benefits. For example, if your employer provides you with free parking or pays your monthly transit pass, the benefit is tax free up to $245 per month in 2013.

Alternatively, your employer may arrange for you to pay your own transit passes on a pretax basis. How it works: You apply a portion of your wages toward the cost of a monthly commuter ticket or pass. The portion used for this purpose—up to $245 per month in 2013—is not part of your W-2 income. Ask your employer for details.

Remember: The cost of commuting to and from work is not deductible, no matter how long or costly the trip.

Source: Rev Proc 2013-15