Casey pushes for tax break for transit commuters

Sen. Robert P. Casey seeks "permanent parity."
Sen. Robert P. Casey seeks "permanent parity."
Posted: April 27, 2014

After a long stalemate, Congress may be moving toward restoring a tax break for transit commuters.

Sen. Robert P. Casey (D., Pa.) and local transit officials gathered in Suburban Station on Friday to urge lawmakers to again give the same tax benefit to commuters who ride buses and trains as those who drive to work.

In 2013, both transit riders and drivers could set aside up to $245 a month to cover their commuting costs, through plans managed by their employers.

That "transportation fringe benefit" is similar to flexible spending accounts for medical or dependent-care expenses. Employees can elect to deduct a certain amount of their salary for commuting costs, if their employers offer the option. Employees benefit by reducing their taxable incomes, and employers benefit by reducing their payroll taxes.

But the transit benefit is caught up in tax-policy debates in Washington, and when it was not renewed by Congress by the end of 2013, the benefit dropped to $130 a month for 2014. The parking benefit for drivers, which is a part of the permanent tax code and does not need regular resuscitation by Congress, rose to $250 per month.

About 2.7 million transit riders nationally use the transit benefit, including about 34,000 SEPTA riders.

The Senate Finance Committee, with Casey and Sen. Patrick Toomey (R., Pa.) as members, voted on April 3 to reinstate the tax provisions that expired at the end of 2013.

That "tax-extender" package would give new life to tax breaks for NASCAR racetracks, rum distillers, film and TV producers, overseas factories - and transit commuters.

The transit benefit would cost taxpayers an estimated $180 million over 10 years - less than three-hundredths of 1 percent of the $700 billion price tag of the entire "tax-extender" package.

The transit benefit "is not a costly provision, but it is grouped together with a lot of other tax provisions," said Brian Tynan, director of government relations for the American Public Transportation Association.

Tynan said transit agencies hope the commuter benefit will be made permanent because "we don't think the federal tax code should have a bias embedded in it for one form of commuting over another."

The full Senate will vote next month on the tax-extender package, Casey said Friday. He said he expects the Senate to approve it, and it would then be considered by the House.

"That's not good enough . . . we want permanent parity," Casey said Friday, "so we don't have to keep revisiting this issue."


pnussbaum@phillynews.com

215-854-4587 @nussbaumpaul

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