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The Journal News Tax Watch Blog: Hayworth Wants to Increase Tax Breaks for Mass-Transit Commuters

In today’s Journal News, transportation reporter Theresa Juva-Brown writes about proposed federal legislation that would bring back a more generous tax break for mass-transit commuting expenses.

 

Federal law used to allow commuters to deduct $230 in pre-tax dollars from their paychecks each month and set it aside for travel expenses. However, the amount was cut to $125 a month in January. Meanwhile, commuters who drive their own cars to work and pay for parking can put away up to $240 monthly before taxes.

Rep. Nan Hayworth, R-Bedford, is proposing a bill that would allow mass-transit riders to set aside up to $240 a month before taxes.“Why shouldn’t those folks have the same kind of tax break as those who drive?” she said. “Our mass transit commuters are helping to save our environment and wear and tear on the roads” by reducing congestion.

Under her legislation, tax breaks would be retroactive to January, and the benefit would be extended until the end of 2013. Hayworth wants to cover the cost of the tax breaks—$139 million—with money from the Prevention and Public Health Fund, which provides disease prevention and education programs.

“I would like to give commuters in these very tough times every help we can,” she said.

The American Public Transportation Association likes the legislation but doubts it will move soon, said Robert Healy, vice president of government affairs.

“I don’t think Congress is going to be doing a lot of tax legislation between now and the election,” he said, but “I would be happy to be proven wrong.”

The original blog post by Cara Matthews and published in The Journal News's Tax Watch Blog can be found here.