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Transit advocates hope for lame-duck action on commuter tax break

Transit advocates hope for lame-duck action on commuter tax break
© Curtis Compton

Transit advocates are pushing lawmakers to revive a tax break for commuters who take public transportation to work that was cut at the beginning of this year during the lame-duck session that began this week. 

The amount of their monthly incomes that transit riders are allowed to set aside before taxes for their commutes to work was reduced from $240 to $130 in January, over the objection of public transit advocates who argued that a similar tax break for drivers who park in garages was left unchanged.

The American Public Transportation Association (APTA) is pushing lawmakers to revisit the transit break during a lame-duck session that is expected to be dominated by tax issues. 

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“Commuters who use public transportation and especially those with the longer commutes by rail, bus, or van pools have seen their annual commuting cost increase by up to $1,380 a year based on a bias in the tax code that eliminated the parity between public transportation and parking benefits for auto users,” APTA President Michael Melaniphy said in a statement.

“Absent Congressional action, the transit commuter benefit dropped at the beginning of this year from $245 to $130 per month, while the parking benefit was automatically adjusted up to $250 per month,” Melaniphy continued. “This equates to a higher tax of approximately $565 annually for those who take public transit. Congress has an opportunity to correct this and restore parity between transit tax benefits and parking tax benefits before the next tax year begins.” 

The transit tax break was originally increased to $240 in the 2009 economic stimulus package. The benefit was reduced when the stimulus ended in 2011, but it was later restored in the 2012 bill to push back the implementation of sequestration until early 2013.

The extension was only for one year, however, so the benefit returned to $130 on Jan. 1.

Supporters of the push to revisit the transit tax break issue during the lame-duck session have gained some powerful allies in Congress, including Sen. Charles Schumer (D-N.Y.). 

Schumer held a press conference at a Metro-North station in White Plains, N.Y., to call attention to the tax benefit disparity for transit riders. 

“As the price of commuting continues to climb, this tax break has become increasingly vital. Mass transit is the lifeblood of Westchester and the greater New York City area, and this provision helps keep it flowing and affordable,” the high-profile senator said. “It makes absolutely no sense to provide those who drive to work with a massive tax break and make commuters who use mass transit pay more. It’s an unwise and unfair disparity in the tax code, and I intend to fix this inequity.” 

Schumer has typically tried to include the commuter benefit in broader piece of legislation that deals with tax issues, but he said this year he is trying to pass a bill to make the transit break permanent. 

The measure, known as the “Commuter Equity Benefits Act,” is being sponsored in the House by Reps. Michael Grimm (R-N.Y.), Peter King (R-N.Y.), Earl Blumenauer (D-Ore.) and James McGovern (D-Mass.). 

Blumenauer and McGovern appeared at a rally on Wednesday with Washington, D.C., Metrorail board Chairman Tom Downs.