Purpose

To advise agencies of the maximum amount allowed as exclusion from gross income for qualified parking benefits provided to employees during 2005.

Affected Employees

Employees receiving qualified parking benefits from agencies

Effective Date(s)

January 1, 2005

Regulations

For 2005 tax reporting, the maximum exclusion from wages allowed for qualified parking is $200.00 per month. Parking on or near the business premises that is provided by State agencies for employees is defined as “qualified parking.” It includes parking on or near the location from which employees commute to work using mass transit, commuter highway vehicles, or carpools. It does not include parking at or near the employee’s home.

Parking is provided by an employer if:

• the parking is on property that the employer owns or leases; or
• the employer pays for the parking; or
• the employer reimburses the employee for parking expenses.

If an employer provides an employee with a qualified parking benefit that exceeds the applicable statutory monthly limit of $200.00 and the employee does not make any payment, the value of the benefit provided in excess of the applicable statutory monthly limit must be included in the employee’s wages for income and employment tax purposes.

OSC Actions

OSC will issue payroll bulletins to communicate qualified parking maximum rate changes as necessary.

Agency Actions

Any qualified parking benefit that exceeds the applicable statutory monthly limit of $200.00 must be added to the employee’s paycheck in Time Entry using the Earn Code TXP (Taxable Parking).

Questions

Questions regarding this bulletin may be directed to the Payroll Deductions mailbox.