RideFinders - Vanpool Incentives

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Vanpool Incentive Program^*

RideFinders Vanpool Incentive Program (VIP) is based on the Internal Revenue Service (IRS) Code that allows employers to reduce the cost of commuting by vanpool for their employees through a pre-tax subsidy. Here is a brief summary of the three VIP options employers can offer their employees and the benefits for each.

Employer-Paid Option:	Employer Tax Benefit:	Employee Tax Benefit:
Employer provides each employee with up to $230 per month to commute to work in vanpools.	Compared to a salary increase, employer saves on payroll taxes as none are paid on the benefit value.	Employee does not pay any taxes on the value of the benefit as compared to a salary increase.
Employee-Paid Option:	Employer Tax Benefit:	Employee Tax Benefit:
Employer allows each employee to set aside up to $230 per month in pre-tax income to pay for vanpools.	Employer saves on payroll taxes as no payroll taxes are paid on the income set aside by the employee.	Employee saves on income tax and payroll taxes as the income amount set aside is no longer taxable.
Employer/Employee Shared Option:	Employer Tax Benefit:	Employee Tax Benefit:
Employer pays some of the vanpool cost and employee sets aside pre-tax income up $230 per month total.	Employer saves on payroll taxes on the part paid by the employee and the benefit value by the employer.	Employee does not pay taxes on the employer benefit value, and the employee set-aside amount.

For more information on RideFinders VIP, please refer to the links below:

Section 132(f) of IRS Code: Governs employer-provided qualified fringe benefits that include commuting by vanpools.
Commuter Choice Toolkit: Federal Transit Administration guide to assist employers with establishing a qualified fringe benefit commuting program for vanpools.

^*The information presented here does not constitute official tax guidance. Please to consult with the IRS or a tax professional for specific guidance.