This bill allows employees to withdraw unused money from their employer-sponsored commuter benefits accounts as a one-time distribution without losing their tax benefits for future commuting expenses. Employees can take out up to the highest balance their account held between March 13, 2020 and the end of 2023, which was the period when many people stopped commuting due to the COVID-19 pandemic. The withdrawn funds would be counted as taxable income for the year the distribution is made, but the account can continue to receive and use future commuter benefits tax-free. The bill applies to transportation fringe benefit accounts that allow unused monthly balances to carry forward to the next month. This legislation gives workers a way to access money that accumulated in these accounts during the pandemic when commuting patterns changed dramatically.
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