The Illinois Department of Revenue (DOR) has adopted recent federal legislation from the year-end 2015 Omnibus Tax Bill that retroactively increases the tax-free exclusion for the combined total of transit passes and van-pool benefits (transit benefit) to equal the tax-free parking exclusion for the 2015 tax year, and provides for parity of the two limitations beginning in 2016.
The transit benefit exclusion is now $250 per month for 2015 (previously, $130 per month). Taxable wages for 2015 should be reduced by the amount of any monthly transit benefit that falls between $130 – $250 and was previously included in Illinois taxable wages.
Employers will need to take action
This late-breaking legislation by the DOR will require employers to file amendments for any affected Illinois withholding taxable wages.
At Paylocity, we work to keep you informed of late breaking changes. Our staff of account managers and trained tax professionals can assist you in understanding how these changes impact your business and most importantly, your employees.
Thank you for choosing Paylocity as your Payroll Tax partner. Should you have any questions please contact your Paylocity Account Manager.
This information is provided as a courtesy, may change and is not intended as legal or tax guidance. Employers with questions or concerns outside the scope of a Payroll Service Provider are encouraged to seek the advice of a qualified CPA, Tax Attorney or Advisor.