Washington – Sen. Charles Schumer called Monday for Congress to renew the federal mass transit break that saves many New York commuters hundreds of dollars a year.
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Many large employers offer transit benefit programs that allow workers to use up to $230 a month of their salaries for mass transit costs. The money is exempt from federal, state and city income taxes.
The pre-tax commuter benefit was $120 a month until 2009 when Congress passed the American Reinvestment and Recovery Act.
The increase was set to expire at the end of 2010, but Congress extended the benefit to Dec. 31, 2011.
Now that the second expiration date is looming, Schumer, D-N.Y., has introduced a bill to make the $230 per month benefit permanent.
“The last thing we should be doing in this economy is making it more expensive for New Yorkers to get to work,” he said at a news conference at Grand Central Terminal. “Increasing fares and decreasing incomes mean we need to help stretch every dollar earned by New Yorkers and that includes keeping programs that reduce commuting costs in place. We cannot afford to let this expire.”
He said 500,000 commuters in the New York metropolitan area and 2.7 million nationwide take advantage of the benefit.
What the average shlub doesn’t know is that this amount is reduced for their gross salary upon which their pension amounts are based. Hence, if you use this bebefit BEAWARE that your pension will be lower.