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Cha-ching! The fringe benefit limit for transit and parking will increase by $15 beginning next year.
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All aboard! The IRS boosted the fringe benefit limit for transit and parking to $340 per month in 2026, up from $325, to account for inflation and increased commuting costs. As a quick refresher, Jawnt broke down what this means for both employees and employers as you move into the new year.
For employees, the benefit limit increase means converting commuting expenses into savings on taxes. By using pre-tax income for your commute expenses, you have lower taxable income. Lower taxable income means more money in your pocket. And with the limit now at $340, you get an extra boost for your commuting budget.
Whether you're an HR leader, benefits admin, or transportation manager, supporting commuter benefits is a smart financial move for you, too. Lower taxable income for your team translates to less spent on payroll taxes. It's a win-win situation! Plus, when employees are less stressed about their commute, the entire workplace is a more positive space.
So, what's next? Employers, make sure to chat with your commuter benefits provider and ensure you are in compliance with the new $340 limit. Already working with Jawnt? Your account manager will have already reached out to help get the relevant changes for your payroll in place. 💫
This increase in the fringe benefit limit is a nod to the fact that commuting can be pricey, and who doesn't want to save a little extra where they can? Whether you're an employee looking to boost your budget or an employer ready to offer financial perks, let's ride into 2026 together!
Happy commuting, everyone!
Want to learn more about how Jawnt can help employees and organizations save money on their commute? Get in touch with our team.
