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Metropool provides free services with the support of the Connecticut and New York State Departments of Transportation

ConnDOT announces DEDUCT-A-RIDE: The Tax-Free Commuter Choice

Connecticut residents and their employers now have access to a dramatically different - and tax-free -commuter benefit. Called DEDUCT-A-RIDE, the program targets the state's companies and introduces a range of tax-free Commuter Choice benefits for both the employer and the employee.

Developed by the Connecticut Department of Transportation (ConnDOT) and MetroPool and implemented by MetroPool, The Rideshare Company and Rideworks, in partnership with the state's business organizations, the statewide program will encourage employers to implement tax-free Commuter Choice benefits through advertising, workshops, and a complete range of free implementation services.

Recently enacted federal law allows a company's employees to use up to $65 a month or $780 a year in before-tax income to pay costs of commuting on public transit and eligible vanpools. That could amount to a savings after taxes of $275 or more for commuting employees and savings on business and payroll taxes for their employers. Up to $175 per month is available to pay for qualified parking on a tax-free basis.

Michael Sanders, ConnDOT Bureau of Public Transportation's Transit Administrator, explains, "This is a program that rewards commuters and companies. We are asking Connecticut's companies to join our efforts to help relieve traffic congestion in the state. In return they become eligible for federal tax savings. Our goal is to establish DEDUCT-A-RIDE programs at 400 employer sites statewide by the end of the year."

"With ConnDOT's support, MetroPool will offer a number of free services that make DEDUCT-A-RIDE a no-cost operation for employers. We offer implementation workshops, customized templates for necessary forms, on-site implementation support, procurement of vouchers as needed, and marketing support. For employers, it's a turnkey operation. We are making it so simple," explained Marsha Gordon, President and CEO of MetroPool.

A statewide advertising campaign, including radio, newspaper, and Internet advertising, began in March and will continue through the spring to raise awareness of the program among employers and commuters. A web site, www.deductaride.com, has been launched that includes Frequently Asked Questions about DEDUCT-A-RIDE, links to relevant sites, and online worksheets to calculate employer savings.

Employers have three options when offering DEDUCT-A-RIDE tax-free Commuter Choice benefits to their employees:

1. Provide the benefit in addition to an employee's current salary. The benefit is free of all payroll and incomes taxes to the employee, and the employer deducts the cost as an expense on his or her business income-tax filing.

2. Permit employees to deduct up to $65 from gross income each month. Employees would not pay income or payroll taxes on the deduction, and the employer would pay no payroll taxes on the amount.

3. Employers can "share the fare." Provide employees with a portion of their commuting expense tax-free in addition to their compensation while also allowing them to deduct a portion from their gross income to pay the remaining amount.

All three options provide pre-tax savings for the commuting employee. "This is a winning program for employers, for commuters-and for the state," said Chris Bruhl, president and CEO of SACIA. SACIA conceived and recruited the chamber network to work with MetroPool to help spread the word about DEDUCT-A-RIDE. "Employers can provide a great perk to their employees. Commuters can save money on taxes. And the state benefits by reducing traffic congestion and helping to protect the exceptional quality of life that attracts businesses and good employees to the area," he added.

The following business organizations are currently participating in the DEDUCT-A-RIDE initiative: Bristol Chamber of Commerce, Greater Bridgeport Regional Business Council, Greater Danbury Chamber of Commerce, Metro Hartford Chamber of Commerce, Middlesex Chamber of Commerce, Greater New Haven Chamber of Commerce, SACIA, and Greater Waterbury Chamber of Commerce.

The business organizations will be supporting the effort through communication to members, workshop sponsorships, and other activities. MetroPool is coordinating the statewide program for ConnDOT. Commuters or their employers who are interested in DEDUCT-A-RIDE may call MetroPool at (888) 399-9323 to learn how to begin a program at their companies.