Publication 15-B - Employer'S Tax Guide To Fringe Benefits - 2012 Page 20
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33•
All of your employees.
provide transportation to your employees) that accounting
for it would be unreasonable or administratively impracti-
•
A group of employees defined under a reasonable
cable. For example, it applies to occasional transportation
classification you set up that does not favor highly
fare you give an employee because the employee is work-
compensated employees.
ing overtime if the benefit is reasonable and is not based
on hours worked.
For this exclusion, a highly compensated employee for
2012 is an employee who meets either of the following
Employee. For this exclusion, treat any recipient of a de
tests.
minimis transportation benefit as an employee.
1. The employee was a 5% owner at any time during
the year or the preceding year.
Qualified Transportation Benefits
2. The employee received more than $115,000 in pay
This exclusion applies to the following benefits.
for the preceding year.
•
A ride in a commuter highway vehicle between the
You can choose to ignore test (2) if the employee was not
employee’s home and work place.
also in the top 20% of employees when ranked by pay for
•
A transit pass.
the preceding year.
•
Qualified parking.
Retirement Planning Services
•
Qualified bicycle commuting reimbursement.
You may exclude from an employee’s wages the value of
The exclusion applies whether you provide only one or a
any retirement planning advice or information you provide
combination of these benefits to your employees.
to your employee or his or her spouse if you maintain a
Qualified transportation benefits can be provided directly
qualified retirement plan as defined in section 219(g)(5) of
by you or through a bona fide reimbursement arrange-
the Internal Revenue Code. In addition to employer plan
ment. However, cash reimbursements for transit passes
advice and information, the services provided may include
qualify only if a voucher or a similar item that the employee
general advice and information on retirement. However,
can exchange only for a transit pass is not readily available
the exclusion does not apply to services for tax prepara-
for direct distribution by you to your employee. A voucher is
tion, accounting, legal, or brokerage services. You cannot
readily available for direct distribution only if an employee
exclude from the wages of a highly compensated em-
can obtain it from a voucher provider that does not impose
ployee retirement planning services that are not available
fare media charges or other restrictions that effectively
on the same terms to each member of a group of employ-
prevent the employer from obtaining vouchers. See Regu-
ees normally provided education and information about the
lations section 1.132-9(b)(Q&A 16–19) for more informa-
employer’s qualified retirement plan.
tion.
Generally, you can exclude qualified transportation
Transportation (Commuting) Benefits
fringe benefits from an employee’s wages even if you
provide them in place of pay. However, qualified bicycle
This section discusses exclusion rules that apply to bene-
commuting reimbursements cannot be excluded if the re-
fits you provide to your employees for their personal trans-
imbursements are provided in place of pay. For information
portation, such as commuting to and from work. These
about providing qualified transportation fringe benefits
rules apply to the following transportation benefits.
under a compensation reduction agreement, see Regula-
•
De minimis transportation benefits.
tions section 1.132-9(b)(Q&A 11–15).
•
Qualified transportation benefits.
Commuter highway vehicle. A commuter highway vehi-
cle is any highway vehicle that seats at least 6 adults (not
Special rules that apply to demonstrator cars and qualified
including the driver). In addition, you must reasonably
nonpersonal-use vehicles are discussed under
Working
expect that at least 80% of the vehicle mileage will be for
Condition
Benefits, later in this section.
transporting employees between their homes and work
place with employees occupying at least one-half the vehi-
De Minimis Transportation Benefits
cle’s seats (not including the driver’s).
You can exclude the value of any de minimis transportation
Transit pass. A transit pass is any pass, token, farecard,
benefit you provide to an employee from the employee’s
voucher, or similar item entitling a person to ride, free of
wages. A de minimis transportation benefit is any local
charge or at a reduced rate, on one of the following.
transportation benefit you provide to an employee if it has
•
so little value (taking into account how frequently you
On mass transit.
Page 20
Publication 15-B (2012)
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