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Tax Benefits

Commute To Work

Meet Amanda

  Amanda's
Taxable Income
FICA taxes @ 7.65%
Federal Withholding
Total Taxes
Transit
Pass
Cost
Take-Home
Pay
No
pre-tax
income
$3,000.00 $229.50 FICA
$360.03 FW $90.01 SW
$679.54 Total
$42.00 $2,278.46
Using
pre-tax
income
$3,000.00
- $42.00
$2,958.00
$226.82 FICA
$350.97 FW $87.74 SW
$665.53 Total
  $2,292.47
Tax Savings for Amanda
using pre-tax income
$2.68 FICA
$9.06 FW $2.27 SW
$14.01 Total
Annual Savings:
14.01 x 12 = $168.12

By deducting the cost of her bus pass from her pre-tax earnings, Amanda saves almost $170 per year, or nearly $850 since she has been employed by ABC.

How Amanda benefits from the pre-tax option:

How ABC Corporation benefits from giving Amanda a pre-tax option:

ABC Corporation's Savings