Drive Time
Get tax break for car pooling, riding the bus
By Scott Ishikawa
Advertiser Transportation Writer
Since last year, the federal government has offered tax breaks to employees willing to commute to work by bus or vanpool.
The catch is employers have to become part of the program for their workers to be eligible.
The Transportation Equity Act For the 21st Century signed into law last year amended the federal tax code to allow employers to let employees set aside up to $65 a month (or $780 a year) of their salary before taxes to pay for transit and vanpool commuting. It also provides the same for qualified parking expenses of up to $175 a month.
Amy Hennessey of public relations firm McNeil Wilson Communications, which recently held a workshop on the program for local businesses, said about 30 companies are already part of the tax-savings program. They include the City and County of Honolulu, Queen's Medical Center and Pleasant Hawaiian Holidays.
"The size of your company does not matter in being eligible" she said. "Your business can range in size from one, two employees to thousands."
There are two ways to become eligible for tax benefits. One is through use of public transit (bus, ferry) or vanpooling. Under the tax program, employees can receive up to $65 a month (or $780 a year) from the employer tax-free (not recorded on W-2.) The employee could also pay for commute with pre-tax income and save on income tax.
This benefit will increase to $100 a month in 2002.
The other option is converting the ridesharing commute into tax savings through employer-qualified parking, up to $175 a month. One example is offering employees an option of giving up their subsidized parking and receiving the value as taxable cash for traveling by transit or vanpool.
The annual tax savings for an employee in the 20 percent tax bracket would be $200 for transit/vanpool and $400 for parking. The employer saves an additional $20 to $100 in payroll taxes.
TheBus and payroll service provider Ceridian also operate a program that makes it easier for companies to purchase and distribute bus passes to employees willing to take the bus.
Business owners wanting to learn more about the tax-benefit program can call one of the four organizations: Vanpool Hawai'i at 596-VANS; TheBus at 848-4500; Ceridian at 837-2200; and the state Department of Transportation Rideshare Office at 587-RIDE.
Child safety seat checks
The Keiki Injury Prevention Coalition will hold two free child safety seat inspections next month. They are scheduled for:
• 10 a.m. to noon Nov. 6 at Kokua Kalihi Valley-Old Clinic, 1846 Gullick Avenue. Contact Nida Peck at 848-0976.
• 10 a.m. to noon Nov. 17 at Windward Mall, 46-046 Kamehameha Highway in K?ne'ohe. Contact Dan Martyniuk at 257-1830.
Reach Scott Ishikawa at sishikawa@honoluluadvertiser.com or 525-8070.
