Qualified Transportation Plan

Policy

The College shall offer a Qualified Transportation Plan in accordance with IRS regulations that allows eligible employees to make payment for parking fees on a pre-tax basis through payroll deduction.

Federal tax law prohibits refunds of pre-tax qualified parking deductions.  Employees are not entitled to parking refunds upon termination of employment.

An eligible employee may opt out of the plan and choose not to purchase a parking pass on a pre-tax basis.  Employees who opt out the qualified transportation plan may purchase a parking pass on an after tax basis.

Purpose

The purpose of this policy is to establish and recognize the College’s Qualified Transportation Plan in accordance with Section 132(f) of the Internal Revenue Code.  This plan excludes from taxable income amounts that are used to pay for qualified transportation benefits.  The College plan includes eligible employee deductions of parking fees on a pre-tax basis through payroll deduction.

To Whom Does This Policy Apply

This policy and plan applies to all academic, classified service, part time hourly and exempt employees who purchase College parking passes.  Eligible employees are automatically covered by the policy and plan unless they elect to opt out of the plan in writing.  This policy does not apply to student employees.

References

26 CFR Section 1.132.9 - Code of Federal Regulations Qualified Transportation Fringe

IRC 132(f) - Qualified Transportation Fringes

IRS Publication 15-B - Employer’s Guide to Fringe Benefits 

OFM Approval Memo - State of Washington Office of Financial Management

Qualified Parking Approval dated March 23, 2004

Definitions

IRS – Internal Revenue Service.

Pre-tax – Not subject to federal income tax, social security tax, or Medicare tax.

Qualified Parking – A College purchased parking pass that falls within the current exclusion limit as defined by the Internal Revenue Code. 

See College Policy- Definitions

Procedure

Please also refer to the Colleges Qualified Transportation procedures at

http://online.tccnet.edu/hr/qualifiedparking.doc

An employee who purchases a parking pass shall:

Authorize a parking payroll deduction by signing their name to an authorization register.  An employee who authorizes a payroll deduction under this plan must certify that he/she is a current College employee.

Human Resources shall:

Make a pre-tax payroll deduction from the employee’s paycheck for the pay period immediately following the employee’s written authorization.  If the employee is not in receipt of a paycheck immediately after the parking pass purchase, the deduction will be held in suspense until the employee receives their next paycheck.