If you live in a metropolitan area, there’s a good chance you take mass transit to or from work. If you use mass transit for work and you are enrolled in a pre-tax Commuter Benefits Plan (CBP) through your place of employment, you’ll want to be aware of what you can (and can’t) purchase with your CBP funds.
If you’re new to CBPs, check out the starter FAQs below. They will give you a basic lay of the land on CBPs before jumping into what is eligible under mass transit. More experienced folks can skip down to the section What is eligible under Mass Transit?
Starter FAQs: CBPs and Mass Transit
How do I know if my employer offers a CBP?
Contact your Human Resources or benefits department. They can tell you if your company offers a CBP, including a Mass Transit Account, and if there are any conditions around who can sign up for the plan. (For example, you may need to work at least 32 hours a week in order to enroll in a CBP. Check with your HR department for more details about if you are eligible to sign up for the plan.)
Additionally, certain cities have mandates in place that require employers to offer CBP. Check out which cities have commuter ordinances in place.
When do I enroll in a CBP?
At most companies, your employer will let you enroll in a CBP on an as-needed basis. In these cases, your employer will set up the framework of the CBP and you will fill in the specifics, like how much money you want to pull from your paycheck each month to put into your CBP.
Some employers may require that you work for your company for a certain time frame (e.g. 60 days) before you are able to sign up for a CBP. If you decide you want to enroll in a CBP, make sure you understand your options, as there are two types of CBPs.
Which type of CBP should I choose?
It is critical to understand that there are two types of CBPs.
The first type is a Mass Transit Account. The second is a Parking Account. The two accounts are independent of each other. That being said, if your employer offers both accounts, you can enroll in both accounts at the same time. However, since the accounts are independent of each other, you must:
- enroll in them separately, if you choose to enroll in both accounts
- fund them separately (your paycheck will show two separate payroll deductions- one for Mass Transit and one for Parking)
Whether you enroll in both accounts or only a Mass Transit Account, it is important to know…
What is eligible under Mass Transit?
An “eligible expense” can be defined as an item or service (such as a monthly pass for a train or bus) purchased from a qualified transit vendor (like Grand Central Station.) An expense purchased from a third party vendor is not eligible and cannot be purchased with funds from your Mass Transit Account (e.g. purchasing a bus pass from Walgreens.)
So, what is eligible under a Mass Transit Account?
- Trains/subway
- Buses
- Amtrak
- Greyhound
- Water ferries
- Vanpool*
- Commuting pass (e.g. weekly bus pass) or token
- Farecard
What is NOT eligible under Mass Transit?
- Gas
- Tolls
- E-ZPass
- Taxis
- Lyft and Uber rides
- Limousines
These are all considered private car expenses and are, therefore, not eligible to be paid with your pre-tax funds.
How do I pay for eligible expenses?
If you have a Commuter Benefit Plan with Benefit Resource, you can use your Beniversal® Prepaid Mastercard® or eTRAC® Prepaid Mastercard to pay for eligible expenses. To find out how much money is in your CBP account, log in to your online account on BRIWEB.
If you still have questions, check out our Commuter Benefit Plan FAQs.
*Note: A commuter highway vehicle means any highway vehicle with a seating capacity of at least six (6) adults (excluding the driver); and of which at least eighty percent (80%) of the mileage for a year is reasonably expected to be used:
- for purposes of transporting employees in connection with travel between their residences and their places of employment;
- on trips during which the number of employees transported for such purposes is at least one-half (1/2) of the adult seating capacity of such vehicle (excluding the driver).
The material in this blog is presented for informational purposes only and such information is believed to be accurate as of the publication date; however, it is subject to change.
Benefit Resource, LLC is an affiliate of Inspira Financial Health, Inc. and Inspira Financial Trust LLC. Benefit Resource, LLC and its affiliates do not provide legal, tax or financial advice. Please contact a professional for advice on eligibility, tax treatment and other restrictions.
