Background:

The Tax Cuts and Jobs Act signed into law last December, more commonly referred to as tax reform, made several changes to the transportation fringe benefit (IRC Sec. 132(f)). The legislation maintained the parking and transit tax benefits for individuals.  However, it also made the transportation fringe benefit more expensive for non-profits and universities that offer it.  Under the new law, non-profits who offer transportation benefits (both parking & transit), are required to pay a 21% Unrelated Business Income Tax on the amounts deducted by employees on a pre-tax basis or provided by employers as a subsidy. The only way a tax-exempt organization can avoid this tax is requiring employees to pay for parking or transit on their own.

CoaST Presentation on UBTI and Impact of Tax Reform on Tax-Exempt Transportation Fringe Benefits

CoaST 1-pager on Changes Made To Transportation Fringe Benefits

House Legislation:

HR 6037 (Conaway R-TX)

HR 6460 (Walker R-NC)

HR 6504 (Clyburn (D-SC)

House Dear Colleague

Status: Pending in Ways & Means Committee (9/4/18)

Senate:

S 3317 (Cruz)

S 3332 (Lankford)

Status: Pending in Finance Committee (9/4/18)

 

Action Center

House:

Status: Approved by Full Appropriations Committee

House Version:

Highlights:

Includes $750 million for Build/TIGER

Adds $4.25 billion above authorized level for Highway Construction Grants **

Adds $800 million above authorized level for additional transit grants

CoaST Position: Mixed 

  • CoaST supports additional funding appropriated by the Committee but is concerned that the funding allocated for transit grants compared to highway grants is not proportionate to current spending levels. CoaST is further concerend by language that only allows State and local governments to spend a majority of the addition $4.25 billion on highway construction. State and local governments should have the flexibility to incorporate transit, ITS, TDM and innovation to solve their transportation needs.

Senate:

Status: Passed Senate Floor (Minibus – HR 6147)

Senate Committee Report

Minibus Bill Text

Summary of Senate-passed Bill

CoaST Position: Support

Bill Number: Discussion Draft

Sponsors: Blumenauer (D-OR) & Crowley (D-NY)

Companion: None

Sponsors: N/A

Text

Summary: Would reinstate the bicycle benefit for individuals and amend it in the following ways:

  • Able to combine with transit/parking
  • Users would be able to take part of their parking benefit and use toward bike expenses
  • Expands definition to include bikeshare

CoaST Position: Support

Additional Links:

Rep. Blumenauer Press Release with CoaST Quote

Unrelated Business Taxable Income - Transportation Fringe Benefits

Background:

The Tax Cuts and Jobs Act signed into law last December, more commonly referred to as tax reform, made several changes to the transportation fringe benefit (IRC Sec. 132(f)). The legislation maintained the parking and transit tax benefits for individuals.  However, it also made the transportation fringe benefit more expensive for non-profits and universities that offer it.  Under the new law, non-profits who offer transportation benefits (both parking & transit), are required to pay a 21% Unrelated Business Income Tax on the amounts deducted by employees on a pre-tax basis or provided by employers as a subsidy. The only way a tax-exempt organization can avoid this tax is requiring employees to pay for parking or transit on their own.

CoaST Presentation on UBTI and Impact of Tax Reform on Tax-Exempt Transportation Fringe Benefits

CoaST 1-pager on Changes Made To Transportation Fringe Benefits

House Legislation:

HR 6037 (Conaway R-TX)

HR 6460 (Walker R-NC)

HR 6504 (Clyburn (D-SC)

House Dear Colleague

Status: Pending in Ways & Means Committee (9/4/18)

Senate:

S 3317 (Cruz)

S 3332 (Lankford)

Status: Pending in Finance Committee (9/4/18)

 

Action Center

FY 2019 Transportation Appropriations Legislation

House:

Status: Approved by Full Appropriations Committee

House Version:

Highlights:

Includes $750 million for Build/TIGER

Adds $4.25 billion above authorized level for Highway Construction Grants **

Adds $800 million above authorized level for additional transit grants

CoaST Position: Mixed 

  • CoaST supports additional funding appropriated by the Committee but is concerned that the funding allocated for transit grants compared to highway grants is not proportionate to current spending levels. CoaST is further concerend by language that only allows State and local governments to spend a majority of the addition $4.25 billion on highway construction. State and local governments should have the flexibility to incorporate transit, ITS, TDM and innovation to solve their transportation needs.

Senate:

Status: Passed Senate Floor (Minibus – HR 6147)

Senate Committee Report

Minibus Bill Text

Summary of Senate-passed Bill

CoaST Position: Support

Bicycle Benefit

Bill Number: Discussion Draft

Sponsors: Blumenauer (D-OR) & Crowley (D-NY)

Companion: None

Sponsors: N/A

Text

Summary: Would reinstate the bicycle benefit for individuals and amend it in the following ways:

  • Able to combine with transit/parking
  • Users would be able to take part of their parking benefit and use toward bike expenses
  • Expands definition to include bikeshare

CoaST Position: Support

Additional Links:

Rep. Blumenauer Press Release with CoaST Quote

Last Update: June 4,2018