HRPAY 17-04, Qualified Transportation Fringe Benefits

Published: January 12, 2017
Effective: Pay Period 01, 2017

Summary

For 2017, the fringe benefit for parking fees will remain $255 per month and the transit benefit allowance will also remain $255 per month.

Implementation

Agency Paid Subsidies

Internal Revenue Service (IRS) regulations state that employee parking subsidies over $255 and transit subsidies over $255 are considered taxable fringe benefits. An Agency’s Time and Attendance (T&A) reporting system can be used to record a parking or subsidy fringe benefit in excess of the IRS limit. This is done via Transaction Code (TC) 17 with Suffix 09 for Parking/Taxable Fringe, TC 17 with Prefix 10 for Transit Subsidy, or TC 17 with Suffix 08 for Chauffeur Driven Auto. When entering employee parking/taxable fringe, transit subsidies, or chauffeur driven auto on the T&A, the benefits may be recorded biweekly, monthly, quarterly, semiannually, or annually (in accordance with Agency policy) and must be reported by the end of the tax year.

In addition to the T&A option, some Agencies utilize the reporting of the parking fringe benefit in excess of the IRS limit of $255 (i.e., taxable portion) via the Parking Fringe Allowance Type 179. When using the Entry, Processing, Inquiry, and Correction System (EPIC), EmpowHR, or an Agency Front-End System Interface (FESI) to record the taxable portion of this fringe benefit, the amount entered in the Allowance Rate field will be reported each pay period until deleted. The allowance record can be processed via the following methods:

• EPIC, Payroll Document, Allowances
• EmpowHR, Payroll Document Menu Group, Allowances Component
• FESI, Allowance Document 127 Data Record Layout

  Note: Agencies should not enter employee parking or transit subsidies using both the T&A and EPIC, EmpowHR, or FESI processes. If two methods are used, the T&A will be suspended. Therefore, timekeepers should check with their servicing personnel office before entering this information on the employee’s T&A.

Employee Paid Subsidies

In situations where the Agency does not pay the employee’s transit or parking subsidy, the employee can report his/her payment of that transit or parking expense as pre-tax on his/her taxes. This is handled via the processing of an allowance record with Allowance Type 525 “Transit Benefits (Non Taxable)” and Allowance Type 526 “Parking Benefits (Non Taxable)." When using EPIC, EmpowHR, or FESI to enter these benefits, the amount entered in the Allowance Rate field will be reported each pay period until deleted. The allowance record(s) can be processed via one of the following methods:

• EPIC, Payroll Document, Allowances
• EmpowHR, Payroll Document Menu Group, Allowances Component
• FESI, Allowance Document 127 Data Record Layout

Resources

The procedure manual for these applications is available online at the National Finance Center (NFC) Web site. To view this procedure, select HR and Payroll Clients from the My NFC drop-down menu on the NFC homepage. At the HR and Payroll Client page, select the Publications tab in the center ribbon and select the applicable publication category to access the procedure manuals within that category.

Inquiries

For questions about NFC processing, authorized Servicing Personnel Office representatives should contact the NFC Contact Center at 1-855-NFC-4GOV (1-855-632-4468) or via the Internet using the Requester Console.