Story URL: http://news.medill.northwestern.edu/chicago/news.aspx?id=111077
Story Retrieval Date: 2/9/2010 9:00:19 PM CST
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2009 brings new benefits for Chicago bicycle commuters, but will they notice?
by Nicole Cohen
Jan 13, 2009
Nicole Cohen/MEDILL
“There’s a fairly large cycling community out there that has blogs and no one really knows what’s going on,” said Carter O’Brien, a frequent bike commuter.
Related Links
League of American Bicyclists Bicycle Commuter Tax FAQIRS Employer's Tax Guide to Fringe BenefitsA guide to bicycle commuter tax benefits
The benefit: employers can exclude up to $20 per qualified commuting month from an employee’s taxable income for reasonable expenses.Qualified commuting month: any month the employee regularly uses a bike for “a substantial portion” of travel between home and work and any month the employee does not receive any other commuter benefit.
Reasonable expenses: the purchase of a bike, bike improvements, repair, and storage.
How to participate in bicycle fringe benefits
Accor Services, the only company so far that plans to handle this benefit, will be offering bicycle commuter tax benefit vouchers for businesses starting in March of 2009.
Employers who start using the benefit on their own are asked to keep good records of the program’s implementation.
Any questions employers have can be directed to the IRS Small Business Hotline at 800.829.4933.
Changes are in store for Chicago’s bicycle commuters in 2009.
After seven years of peddling around the Capitol, Congress finally passed a bicycle commuter tax benefit that would allow for employees to be reimbursed up to $20 a month for bicycle commuting expenses.
The only problem is that nobody seems to know how to use it.
“We’re waiting around like everyone else,” said Margo O’Hara, spokeswoman for the Active Transportation Alliance, a Chicago-area biker and pedestrian advocacy group.
O’Hara said the IRS would normally give out guidelines for how to participate in tax benefit programs, but two weeks into the new year, the agency has yet to issue any bike-specific publications.
“Whether there is going to be additional guidance coming out, I’m not sure,” said IRS spokesperson Sue Hales.
Hales said that the bicycle commuter tax benefit should be handled the same as any other transit benefits employers may offer.
Employers often outsource their employee transit benefits. So far, the American League of Bicyclists website shows one transit benefit provider that will be offering bicycle commuter options starting in March.
But smaller businesses that can’t necessarily afford to outsource their fringe benefit management are left to figure things out for themselves.
Hales recommends that any employer choosing to participate in the fringe benefit program keep good records of their employees’ expense claims.
“If a business has questions about this, they can always call the IRS.”
Still, Chicago businesses are hesitant to participate in a program they know little about. “It’s so new,” said Josh Deth, co-owner of the Handlebar Bar & Grill in Wicker Park. “It’s a logistical nightmare.”
Carter O’Brien, an employee of the Field Museum, frequently uses his bike to commute to work. O’Brien said he doesn’t think the new benefit will do much to get more people peddling. “It’s probably going to be a boon to people already doing it,” O’Brien said.
Even so, O’Brien said $20 a month doesn’t go far to keep your wheels turning.
For now, the main obstacle is getting the word out when people’s eyes are turned to a hurting economy and the change in administration.
O’Brien said he doesn’t believe the new benefit will have much of an impact. But after years of fighting for better conditions for the city’s bicycle commuters, “It’s certainly welcome.”
