Bus passes are the mainstay of many commuter benefit programs. They are highly valued by employees and can be low to no-cost for the company. You can offer employees the convenience of obtaining bus passes at work and at the same time take advantage of the commute tax benefits now available to workers who commute using public transportation.
Who pays for the passes or vouchers?
The company decides whether to subsidize any part of the bus pass cost. Any company-paid subsidy is tax-free to eligible employees up to $115 per month. The individual employee would pay any balance not covered by a company subsidy.
When the employee is responsible for any or all of the cost, the amount can be collected directly from the employee or it can be recovered through a pre-tax payroll deduction of up to $115. A pre-tax deduction will save payroll taxes for both the company and the participating employees, effectively increasing the employees' take-home pay.
King County companies must distribute passes or vouchers (or use a third-party service company) in order for employees to qualify for the tax-free, company-paid subsidy or the employee-paid, pre-tax option. See the Pass Sales and Voucher programs for instructions on how to order.
If employees purchase their own passes and receive a cash reimbursement, the reimbursement is taxable to the employee.
How much do the passes cost?
The number and types of passes you order and the amount your company decides to subsidize per pass will determine your final cost. There are no service charges.
See PugetPass (retail) fares for individual employees or Area FlexPass prices for all employees.
