The NJ Commuter Benefit Law Coming March 2020

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Public Transit train passing by. NJ Commuter Benefit Law

The NJ Commuter Benefit Law Coming March 2020

January 10th, 2020

The new year comes with many changes for employers, but it doesn’t just stop after January.  With the world constantly changing around us, so are the laws that we must follow.  As of March 1st, the New Jersey Commuter Benefit Law will go into affect.  As you may already be aware, employers with more than 20 employees will be required to offer pre-tax commuter benefits to employees.  This new law applies to anyone covered by New Jersey’s unemployment insurance law, however employers who hold a collective bargaining agreement are exempt until it expires.

What Does This Mean?

In short, the new commuter benefits requires employers to offer their employees a choice between taxable compensation or nontaxable qualifies transportation fringe benefits.  Employees must be allowed to choose up to $270 for 2020, which applies to commuter highway vehicles such as vanpools, and public transit.  While this benefit is now required, it’s important to note that this expense is not deductible from federal corporate income taxes.

As always, Innovative Benefit Planning is available if you have any questions or concerns, and can also assist in setting up these benefits.

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