Transit Plan and Dependent Care Legislation Updates

Congress approved a one year extension through 12/31/2011 of the pre-tax mass transit benefit cap of $230 per month. Without the extension, the monthly maximum contribution would be reduced to the prior limit of $120.

The legislation also extends prior expiring changes to the dependent care tax credit, which has the following impact on dependent care benefits:

  • Extends the increased tax credit amount for dependent child care expenses under Section 21 (remains $3000/6000 in lieu of $2400/4800)
  • Extends the higher assumed earnings amount for an incapacitated or full-time student spouse (remains $250/500 in lieu of $200/400).

In Notice 2010-94, the IRS delayed the effective date for the transit plan debit card ruling (Revenue Ruling 2006-57) until January 1, 2012: http://www.irs.gov/pub/irs-drop/n-10-94.pdf. The delay is to provide transit systems more time to adapt their technology for compatibility with the requirements for vouchers


Click Here to Chat
Chat Offline
FSA Eligible Expenses and Items

Need a Quote?

Click here and submit your details below


 

 

Copyright © 2019 HRC Total Solutions, All Rights Reserved Website Design & Development by:The Scribbit