EPISODE 37 ~ SAVE MORE: Commute: Pay For Parking At Your Work On A Pretax Basis

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Did you know that you can pay for parking that’s part of your work commute on a pretax basis?

I used to do this myself when I worked at ABC News in the Washington DC bureau.  According to Wageworks, the dominant company that administers this federal program, you can get this benefit if you pay to park at or near work OR if you park somewhere remote, like a metro parking lot, and then take the train to work.  

For 2018, you can contribute up to $260 per month on a pre-tax basis to pay for your parking.  A definition here might help: Paying on a “pre-tax basis” means that the money you pay for parking comes out of your salary before you pay any taxes on it.  This reduces the amount of income you are taxed on, which means you pay less in federal taxes.

Once you set up this special commuter parking account, you can either use the money to pay your parking garage directly, or you can pay for parking yourself and get reimbursed.  In addition, some employers provide prepaid parking cards, kind of like debit cards, that you can use to pay for parking.

Many cities are now mandating that employers must offer mass transit or parking benefits like this.  If your employer does not, you should form a group and request this benefit.  After all, it’s your money.  The only expense to the company is the cost of administering the program. 

Wageworks seems to have cornered the market on offering commuter parking benefits, so I will link you to Wageworks’ parking page where you can get all of the information you need to pursue this perk!

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