Toward the end of 2023, Illinois enacted the Transportation Benefits Program Act. This Act, which became effective January 1, 2024, requires employers with 50 or more employees to provide their employees with a pre-tax commuter benefit. In this regard, covered employers must allow their employees to use pre-tax dollars for the purchase of a transit pass through payroll deduction. The cost for such transit pass may be excluded from employees’ taxable wages and compensation up to the maximum allowed by federal tax law. The maximum amount per month in 2024 is $315 per employee.
This benefit should be offered to all employees starting at the first full pay period after 120 days of employment.
Employers can comply with this law by participating in a program offered by the Chicago Transit Authority or the Regional Transportation Authority.
Please see the checklist on the following checklist to see if this Act applies to you:
If you answered yes to these questions, you are a covered employer who will need to comply with the transportation benefits program.
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