Question

The following information applies to the questions displayed below! LaMont works for a company in downtown Chicago. The company encourages employees to use public transportation (to save the environment) by providing them with transit passes at a cost of $290 per month Problem 12-47 Part a a. If LaMont receives one pass (worth $290) each month, how much of this benefit must he include in his gross income each year? Transit pass benefit to be included in gross income

Answer 1

Ans: For 2019, The maximum exclusion of the qualified transportation fringe is $265 per month or 3180 annual;

A). as per limits of 2019 Lamont can exclude $265 per month from his gross income:

The cost of =$290-$265

=$25 per month will be included in gross income:

Pass benefit that will be included in gross income= $25*12

=$300

B). If the company provides $290 each employee with parking benefits then it can be considered as qualified transportation fringe.

Therefore the cost i.e. $290- $265 per month will be included in gross income of Lamont:

Total inclusion= $25*12

= $300