It’s no secret that New Yorkers rely on public transit. Each weekday, New Yorkers take more than 7.8 million rides on the bus and subway. When those riders pay those fares, they have already paid income tax on the money they use. For instance, an average New Yorker buying a $112 monthly transit pass has already spent around $36 in federal income tax on that money before it even made it into their paycheck.
Beginning in January, 2016, all of that will change. Thanks to the newly passed Affordable Transit Act, New Yorkers can set aside up to $130 per month for Mass Transit and $255 per month for Parking. These amounts will be free from State and Federal taxes. An employee earning the New York City median income1 would save nearly $2000 dollars over the course of a year.
The program is popular with employers, too. Not only does it allow them to offer employees a money-saving benefit for free, but it saves employers hundreds of dollars a year too by reducing their payroll tax burden. For every dollar an employee spends on pre-tax transit benefits, an employer can save up to 7.65¢ in avoided federal payroll tax2. This means that an employee making the median New York City salary and regularly buying monthly public transit passes using transit benefits will save their employer about $350 every year.
SASI, based in Milwaukee, WI, is a nationwide third-party administrator who specializes in Section 125 Cafeteria Plans and Section 132 Transportation Plans. SASI is has been helping companies create and administer employee benefit plans for over 25 years.
What makes SASI in the world of plan administration is their extremely high quality of customer service. Unlike many of their competitors, each phone call to SASI is answered by a live human being. SASI’s customer service representatives are veterans capable of immediately responding to their client needs. This expertise is important to both Employers who set up and administer the plans as well as the employees who calling to inquire about claims.
Experience the difference today! Call SASI at (800) 752-3539 or click here for more information!
1The median household income across New York City stands at $50,711, according to 2010-2012 estimates from the U.S. Census Bureau.
2Employers are required to pay a 6.2% Social Security tax plus a 1.45% Medicare tax, for a total of 7.65%.