New Bicycle Commuting Employee Benefit Available in 2009

Used with permission 10-20-08

Cynthia Vanbogart, JD Boardman Law, Madison WI 

This FYI provides information about a new bicycle commuting benefit that may be of interest to employers thinking “green.”  Starting in 2009, bicycle commuting expenses of up to $20 per month can be reimbursed by the employer on a tax-free basis. Reimbursable expenses include the cost of bicycle purchase, improvements, repair, and storage, if the bicycle is regularly used for a substantial portion of the travel between the employee’s residence and place of employment.  The law includes limitations on timing of reimbursements as well as coordination limitations if the employer offers other qualified transportation benefits.

What should interested employers do?
– Consult with counsel regarding the details of this new benefit.  If you do not offer qualified parking or bus pass programs, this may be a good time to consider those benefits.
– Prior to January 1, 2009, consult with counsel to prepare the necessary forms and employee communication materials, and to consider what plan documentation may be needed to put the benefit in place.

Please contact me if you would like more information.

This FYI is not legal advice. Individuals should seek advice based on their particular circumstances from their own counsel. Nothing in this FYI is intended to be used, and no information can be used, for the purpose of avoiding penalties under the Internal Revenue Code, or promoting, marketing, or recommending to another party any transaction or matter addressed in this FYI.

Cindy Van Bogaert

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