Employer Services
Transportation Reimbursement Plan FAQ's

1. What is the benefit to the employer to offer a Qualified Transportation Program?
2. Do I have to have a plan document for a Qualified Transportation program?
3. How often do I have to allow changes in elections by employees?
4. Is there any risk to the employer in offering such a program?

1. What is the benefit to the employer to offer a Qualified Transportation Program?
All employee elections deducted for qualified parking or mass transportation expenses save the employer the 7.65% of employer payroll taxes. This program also helps to sustain employee morale and round out a comprehensive benefit package.

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2. Do I have to have a plan document for a Qualified Transportation program?
Transportation accounts for Parking & Mass Transit expenses fall under Section 132 of the IRS code. The IRS does not require a plan document and Summary Plan Description for this program; however, they do require that clear processes and policies be in place.

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3. How often do I have to allow changes in elections
by employees?
Section 132 of the IRS code states that employees much be allowed to make changes in elections at least quarterly. Many employers allow changes as frequently as monthly. The change must also be provided in writing.

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4. Is there any risk to the employer in offering such a program?
Because this program does not allow employees to access more funds than they have contributed by payroll deduction, there is no financial liability to the employer in offering this program.

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