The State Senate has voted to restore a monthly $240-dollar pre-tax credit for mass transit users -- at least for the state portion of commuters' tax bills.
The state benefit was tied to a similar federal one that was cut last year after federal lawmakers failed to extend it before an end of year deadline. That benefit allowed commuters to deduct up to $230 dollars each month from their federal taxes to offset mass transit or parking costs. But because Congress didn’t act on the federal tax break, the state one got cut too.
The Senate legislation would restore the benefit on the state level. It would also uncouple the tax credit from the federal legislation. If the bill passes in the State Assembly, the commuter credit would be restored to 2011 levels and adjusted annually for cost of living increases, regardless of whether Congress authorizes additional extensions at the federal level.
Senator Charles Fuschillo, Chairman of the Senate’s Transportation Committee, sponsored the bill. “With Washington’s lack of action, New York State should do what it can to restore these state tax savings and put money back in the pockets of hard-working commuters. I’m pleased the Senate has passed this legislation and I urge the Assembly to do the same,” said Senator Fuschillo.
It now goes to the State Assembly.
On a federal level, the transit tax deduction may be re-introduced as part of negotiations over the payroll tax cut.