H.R.409 - Supporting Transit Commutes Act (119th Congress)
Summary
H.R.409, the Supporting Transit Commutes Act, aims to amend the Internal Revenue Code of 1986 to allow employers to deduct certain transportation fringe benefits provided to employees. This includes benefits for commuting via transit, up to a certain limit. The bill adjusts Section 274(l) of the tax code to create an exception for these transportation fringe benefits.
Expected Effects
The primary effect of this bill would be to incentivize employers to offer transportation benefits to their employees. This could lead to increased use of public transit and reduced reliance on personal vehicles for commuting. The bill also includes a provision for reduced deductions in cases where employees can choose between the fringe benefit and cash.
Potential Benefits
- Increased public transit usage: By incentivizing employers to offer transit benefits, the bill could lead to more people using public transportation.
- Reduced traffic congestion: Increased transit usage could reduce the number of cars on the road, easing traffic congestion.
- Potential cost savings for employees: Employees receiving transit benefits may save money on commuting costs.
- Environmental benefits: Reduced car usage can lead to lower emissions and improved air quality.
- Support for businesses: The deduction could make it more attractive for businesses to locate in areas with good public transit.
Potential Disadvantages
- Potential for tax revenue loss: Allowing employers to deduct these benefits could reduce overall tax revenue.
- Complexity in tax code: The amendment adds complexity to the tax code, potentially increasing compliance costs.
- Limited impact: The impact may be limited to areas with well-developed public transportation systems.
- Possible inequity: Employees who do not use public transit may not benefit from this provision.
- Administrative burden: Employers may face additional administrative burden in managing and reporting these benefits.
Constitutional Alignment
The bill appears to align with the general welfare clause of the Constitution (Preamble). It aims to promote the general welfare by incentivizing public transit use, which can have positive environmental and economic impacts. The bill falls under the powers granted to Congress in Article I, Section 8, which includes the power to lay and collect taxes, duties, imposts, and excises to pay the debts and provide for the common defense and general welfare of the United States.
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).