BOSTON, April 22, 2019 /PRNewswire/ -- If you work in New Jersey, your commute may be getting less expensive in the next year or so.
Earlier this year, New Jersey became the first state to mandate offering commuter benefits when Governor Murphy signed into law the New Jersey Senate Bill 1567. Joining large cities like San Francisco and New York City, New Jersey will be requiring employers to provide a pre-tax commuter benefit to their employees.
Here are the highlights of the New Jersey commuter benefits law.
Info for businesses
Enforcement of the law could begin as early as March 1, 2020. When it launches, all companies that employ at least 20 people must start offering commuter benefits to eligible employees averaging 10 hours or more per week.
The New Jersey law follows the rules for transportation fringe benefits as defined by the IRS and excludes tax-exempt organizations.
This pre-tax benefit allows commuters to set aside pre-tax funds, currently a maximum of $265 per month, to use for commuting costs including mass transit, rideshares or qualified parking.
The benefit to businesses is that they pay up to 7.65 percent less in payroll tax because their employees will save money tax-free in their paychecks.
Employees who work under a collective bargaining agreement or are federal employees may have regulations that govern commuter benefits.
New Jersey is still working on specific rules and regulations for how commuter benefits will be regulated at the state level, and how the law will be enforced. However, there will be civil penalties if a business does not comply, as is typical with other municipal commuter benefit laws.
The new law does not require employers to subsidize transit expenses, it only requires employers to give employees the option to enroll in a pre-tax program whereby employees use their own wages on a tax free basis. In addition to becoming compliant with the law, companies offering commuter benefits have a competitive advantage in hiring and retaining employees.
Edenred Commuter Benefits Solutions is the first provider to offer a free toolkit guide to help employers learn how to set up a compliant program that meets federal and state laws.
Programs can be administered using prepaid debit cards, smart cards, transit passes, direct pay, and cash reimbursement, along with other types of payments.
Edenred Commuter Benefits Solutions help business set up a compliant commuter benefits program. Visit commuterbenefits.com to learn more.
About Edenred Commuter Benefit Solutions
Edenred Commuter Benefit Solutions (ECBS) is the nation's only comprehensive commuter benefit solutions provider and number one resource for commuter savings. Since 1985, ECBS has served Fortune 100 and Fortune 500 companies and top third party benefit administrators.
Our B2B commuter services:
- Partners with over 50 national third party administrators (TPAs), 350+ Transit Agencies, 5,000+ parking locations and 650+ bicycle shops nationwide
- Transit, Parking, Vanpooling, Ridesharing, Bicycling
- All fare media and fare collection systems
- Small and large employers
- Corporate commuter benefits program administrator on behalf of transit agencies (managed program), including:
- RTA Chicago
- DVRPC Philadelphia
- MBTA Boston
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SOURCE Edenred Commuter Benefit Solutions