Skip to main content

The Connector Logo

Commuter transit tax benefit restored through fiscal cliff deal

Under the fiscal cliff deal reached Jan. 1, Congress restored the maximum amount an individual can set aside pre-tax for mass transit expenses to $240, equal to the benefit received by those who drive to work and park. This move will benefit almost 1 million transit riders in the Chicago region. 

When the stimulus passed in 2009, it included parity between transit and parking, but due to inaction by Congress, the transit portion was cut in half— from $230 a month to $125—when the measure expired Jan. 1, 2012. Meanwhile, the parking benefit increased to $240 a month to account for inflation. Unfortunately, the parity restoration is still temporary and will expire at the end of this year, unless Congress extends it again. 

Illinois Reps. Hultgren, Biggert, Lipinski, Quigley, Dold and Rush offered an amendment to restore parity in the transportation authorization that passed last year. Language made it into the Senate passed version, but was cut in the final law.  

Restoring parity with the parking tax benefit is a smart investment that decreases the tax burden on employers, reduces traffic congestion and our reliance on foreign oil, promotes cleaner air, and provides revenue for our cash-strapped mass transit systems.

Tax-free commuter benefits only may be provided through employee-funded, pre-tax payroll deductions or employer-funded or partially funded benefits. Workers may spend the money on commuter rail, subway and bus transportation, eligible vanpools, and commuter-related parking. 

| Share


  1. 1. Brendan Saunders from Kenosha on January 2, 2013

    I am a little unclear about the new transit deductions. Can I now have up to $240 for my transit pass and $240 for my parking? Or is it $240 combined for both transit passes and parking?

  2. 2. Chrissy on January 2, 2013

    Hi Brendan - you can deduct up to $240 for transit and $240 for parking.

Post a comment

Won't be displayed

Type the characters shown above:

Comments are moderated and generally will be posted if they are on-topic and not abusive. For more information, please see our Comments FAQ.

About The Connector

The Connector is MPC's blog, written primarily by MPC staff members, with occasional guest posts from volunteers and partners. 


Contribute to The Connector

MPC on Twitter

Follow us on Twitter »

Blogs MPC Loves

Latest popular keywords

Browse all keywords »

Browse by date

2009 5 7 16 21
2010 13 20 29 21 17 24 19 21 20 12 19 9
2011 20 16 11 16 12 9 13 18 12 16 8 11
2012 16 18 14 11 7 22 26 19 15 16 15 9
2013 19 15 15 14 16 17 13 15 21 26 10 11
2014 8 9 20 16 19 17 9 12
Metropolitan Planning Council 140 S. Dearborn St.
Suite 1400
Chicago, Ill. 60603
P 312 922 5616 F 312 922 5619
Helping create competitive, equitable, and sustainable communities

For 80 years, the Metropolitan Planning Council (MPC) has made the Chicago region a better place to live and work by partnering with businesses, communities and governments to address the area’s toughest planning and development challenges. MPC works to solve today's urgent problems while consistently thinking ahead to prepare the region for the needs of tomorrow. Read more about our work »

Donate »