30 percent off RT passes

After six months of buying monthly passes to ride Sacramento Regional Transit, I discovered that I could buy the passes using pre-tax dollars, and thus save about 30 percent off the overall cost.

This is just one piece of information I discovered recently at the Sacramento Transit Association Web site at www.sacramento-tma.org.

"The Sacramento Transportation Management Association is an independent, non-profit membership association, representing 145 employers and helping more than 87,153 commuters find alternatives to commuting alone to work. The TMA was founded in 1990 by employers that were concerned about the negative impact of Sacramento's traffic congestion and air pollution on their employees' commutes and quality of life. "

Reading the Sacramento TMA newsletter, I found this tidbit:

"The Commuter Choice Initiative allows employers to provide greater commute benefits. Described in Title IX, section 910 of TEA-21, this initiative changes IRS code, section 132(f)(4) to allow pre-tax payment of transit, vanpool or parking costs.

Employers can subsidize up to $65 of transit or vanpool expenses, or $175 of parking costs, per month tax-free.

Or employees may set these amounts aside tax-free in an account. The account is different from traditional cafeteria plans, no plan filings are required and an employee does not lose any unused amount they have set aside.

The pre-tax and tax-free benefits do not apply to carpooling costs and the law requires that employers use a debit system or vouchers such as Transit Chek (the phone number for TransitChek is 1-800-531-2828).

The savings add up. For every dollar employers provide, they save up to ten cents; employees save 30 cents."

Sure enough, when I checked with my personnel office they already had a program in place. Unlike pre-tax money for health costs, you can sign up at any time and stop at any time. In the program my employer offers, the price of the monthly pass is deducted in pre-tax dollars. You then purchase the pass and send the receipt to the company that handles the health cost reimbursements. They send you back a check. As explained to me, my program allows you six months to request reimbursement. If you don't ask for the money back in six months, then you lose it.