Parking expense to become pretax payroll deduction

The end of 2019 ushered in changes to existing federal tax law. As a result, the Medical Center can now treat employee parking expenses as a pretax deduction.

These changes were passed at the end of December 2019. It repealed a section of the 2017 tax law that required non-profit employers to pay unrelated business income taxes on provided transportation benefits, including employee parking.

As a result, starting in 2020 employees parking deductions will now become a pretax expense on their paycheck rather than an after-tax deduction. Biweekly paid employees will first see this on their Jan. 24 paycheck and monthly paid employees on their Feb. 3 paycheck. Employees can review their payroll deductions on C2HR.