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Tax Advantages

One Smart Trip option is the Bus Pass Subsidy Program. The RTC will match employer contributions for purchase of monthly bus passes up to 20%.

The employer may be eligible for federal tax deductions as spelled out in the Internal Revenue Code/Section 132 (f), and the employee receives a tax-free benefit.

Following are just two examples of ways businesses can participate in this program:

Example 1

Employer Provides Adult 31-day RTC RIDE Bus Pass Free to Employees:

RTC RIDE Adult 31-Day bus pass

$70.00
RTC match at 20% of face value $14.00

Employer's purchase price

 $56.00

Employer benefit: The $56.00 per month is tax deductible at the employer's regular tax rate and a reduction in payroll taxes.

Employee benefit: They receive 31 days of transportation FREE.

 

Example 2

Employer Provides Adult 31-Day RTC RIDE Bus Pass at Reduced Cost to Employees:

RTC RIDE Adult 31-day bus pass

$70.00
Employer subsidizes at 20% of face value $14.00

RTC match at 20% off face value

 $14.00

Employee's purchase price

 $42.00

Employer benefit: The $14.00 per month is tax deductible at the employer's regular tax rate and a reduction in payroll taxes.

Employee benefit: The $42.00 per month payroll deduction is considered a tax-free benefit.

At a 15% tax bracket, with retail and tax savings, employees may save more than $450 per year!