Nicole's employer pays her $150 per month toward the cost of parking near a railway station where Nicole catches the train to work.The employer also pays the cost of the rail pass, $75 per month.Nicole can exclude both of these payments from her gross income.

Question

Quizplus · Accepted Answer

According to the IRS, both employer-provided parking and transit passes are excluded from an employee's gross income up to certain limits. In 2021, the monthly limit for employer-provided parking is $270, and the monthly limit for transit passes is $270 as well. Since Nicole's employer is paying $150 for parking and $75 for a rail pass, both of these payments fall below the monthly limit and can be excluded from her gross income.

Nicole's Employer Pays Her $150 Per Month Toward the Cost