Bailout Bill has Hidden Tax Break for Cyclists
by Lloyd Alter, Toronto on 10. 7.08
Xavier Snelgrove, Wikipedia commons
Some of the hidden pork in the Bailout Bill have been written about for their silliness, like the Sec. 503. Exemption from excise tax for certain wooden arrows designed for use by children, others are not very green, like the Sec. 317. Seven-year cost recovery period for motorsports racing track facility , which costs a cool hundred mil to give a fast tax break to the motor sports industry. However there is one particular one that TreeHuggers should love: Sec. 211. Transportation fringe benefit to bicycle commuters
it allows for a "qualified bicycle commuting reimbursement" for "reasonable expenses incurred by the employee during such calendar year for the purchase of a bicycle and bicycle improvements, repair, and storage, if such bicycle is regularly used for travel between the employee’s residence and place of employment"- your bike expenses, up to 20 bucks a month, can be covered by your boss as a benefit tax free. Full copy below fold. via ::Spacing Wire
“(a) In General- Paragraph (1) of section 132(f) is amended by adding at the end the following:
`(D) Any qualified bicycle commuting reimbursement.’.
(b) Limitation on Exclusion- Paragraph (2) of section 132(f) is amended by striking `and’ at the end of subparagraph (A), by striking the period at the end of subparagraph (B) and inserting `, and’, and by adding at the end the following new subparagraph:
`(C) the applicable annual limitation in the case of any qualified bicycle commuting reimbursement.’.
(c) Definitions- Paragraph (5) of section 132(f) is amended by adding at the end the following:
`(F) DEFINITIONS RELATED TO BICYCLE COMMUTING REIMBURSEMENT-
`(i) QUALIFIED BICYCLE COMMUTING REIMBURSEMENT- The term `qualified bicycle commuting reimbursement’ means, with respect to any calendar year, any employer reimbursement during the 15-month period beginning with the first day of such calendar year for reasonable expenses incurred by the employee during such calendar year for the purchase of a bicycle and bicycle improvements, repair, and storage, if such bicycle is regularly used for travel between the employee’s residence and place of employment.
`(ii) APPLICABLE ANNUAL LIMITATION- The term `applicable annual limitation’ means, with respect to any employee for any calendar year, the product of $20 multiplied by the number of qualified bicycle commuting months during such year.
`(iii) QUALIFIED BICYCLE COMMUTING MONTH- The term `qualified bicycle commuting month’ means, with respect to any employee, any month during which such employee–
`(I) regularly uses the bicycle for a substantial portion of the travel between the employee’s residence and place of employment, and
`(II) does not receive any benefit described in subparagraph (A), (B), or (C) of paragraph (1).’.
(d) Constructive Receipt of Benefit- Paragraph (4) of section 132(f) is amended by inserting `(other than a qualified bicycle commuting reimbursement)’ after `qualified transportation fringe’.
(e) Effective Date- The amendments made by this section shall apply to taxable years beginning after December 31, 2008.”
Now what about the food you eat to ride?
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too bad they wouldn't also let me deduct qualified not reimbursed expense. i bought i a bike for 850, i wish i could deduct that from my taxes since i commute to work >80% of the time.
can someone decipher this and tell me if this is only for employers, or if you can claim it personally? It appears top work both ways according to section F-ii-I
Well..that's just great!! What country????
Lloyd is writing from Canada, but the US is the country that is doing the "bailout." Maybe this is in Australia? Maybe Venezuela or Cuba? Or, maybe Lloyd should remember that the WWW has a world-wide audience!
Great for bike shop owners/employees or bike messengers, but I doubt many employers would go thru the hassle for a standard commuter. As I take it you can purchase a bike $300 and have it spread out over 15 months or use it for standard repair fees. I bicycle to work, but I highly doubt my employer would take the time to file the paperwork.
I haven't been able to find that text in the bailout texts I've found online. None of them show more than a section 303.
Oink, oink Baby!
well, unless your head is under a rock you should know that the BAILOUT is 700 billion in US, i dont think there are any other bailouts right now that are being talked about, if you didnt know it is in america, read the news
Ridiculous!
I ride my bike every day, and I think commuting by bike (where feasible) is a great idea for many reasons.
But this kind of policy is ridiculous. Creating yet another inefficient subsidy for a special interest group that has to be paid for by the general public. Not to mention the admiinistrative burden. That's exactly the kind of pork-barrel spending you would condemn if it didn't happen to be convenient for you.
Just tax carbon emissions and get rid of all those individual subsidies.