Transportation Compliance

Sec 132 IRS regulations state that a cash reimbursement may not be provided to an Employee for eligible transit expense if a voucher is readily available to the Employer for distribution to the Employee.  Metro areas across the nation have different mass transit programs, so this will vary by city. 

Vouchers (or similar) are considered readily available if:  (1) the Employer can obtain the vouchers on the same or better terms as the Employee and (2) a significant administrative cost is not incurred by the Employer in obtaining the vouchers 

The administrative cost is considered "significant" if your local transportation fare provider imposes costs in excess of 1% of the annual value of the voucher.