wageworks nyc ordinance webinar

SAVE BIG ON TAXES

P R E S I D E N T , W A G E W O R K S C O M M U T E R S E R V I C E S

W I T H T H E N E W Y O R K C I T Y T R A N S I T O R D I N A N C E

D A N N E U B U R G E R

© 2015 WageWorks Inc. All rights reserved.

Agenda

Introduction to the New York City Transit Ordinance

What the Ordinance Means to Employers

How to Comply – and Save – with Commuter Benefits

Why WageWorks

Q&A

© 2015 WageWorks Inc. All rights reserved. 3

N E W YO R K C I T Y L O C A L 2 0 1 4 - 0 5 3

NYC Transit Ordinance

About the Ordinance

WhoNew York City has more transit riders than any other city in the country: more than 450,000 employees* may benefit by this Act.

WhatNew York City approved the Transit Ordinance on Oct. 20, 2014, which requires employers with 20 or more full-time employees to offer commuter transit benefits.

* Source: Riders Alliance

http://www.ridersny.org/


A Win for Everyone

• Decrease payroll taxes: employee pre-tax withholdings lower the total tax burden

• Offering commuter benefits enables companies to better attract and retain employees

• Pay for commute with pre-tax dollars

• Lowers their taxable income so they pay less in federal, state, local and payroll taxes

EMPLOYERS EMPLOYEES


Some Exceptions

• NYC Transit Ordinance doesn’t apply to all companies Federal, state, and local governments Union employees Employers that don’t pay federal, state and/or city payroll taxes

• Commuter Benefits Programs don’t apply to all people All “Employees” as defined by the IRS However not “Everyone”

• Self-employed persons

• Partners

• Owners of at least 2%+ of an S-Corporation

• Sole proprietors

• Independent contractors

Time is Right

• Ordinance has a deadline: companies have until December 31st to comply 6-month grace period After June 30, 2016 penalties up to

$250 per month

• Why wait? No ‘open enrollment’ period The sooner the program begins, the sooner savings begin accruing

Start saving now!



Commuter Benefits


About Commuter Benefits

• Employer-provided monthly benefits that allow employees to reduce their commuting expenses for transit, vanpooling, biking and qualified parking While the Ordinance only covers transit, it can be combined with parking

• Deliver savings for employers and employees Money-making benefit: savings on payroll taxes for employer and

payroll/income taxes for employees Employees may enroll and cancel at anytime – not tied to annual

enrollment

• Many NYC-based employees depend on public transit to commute to work and should take advantage of this tax break


Your Employees Save on Transit…

No Commuter Benefits

Salary $4,000

Deduction -$0

Salary Subject to Taxes $4,000

Estimated Taxes (35%) -$1,400

Transit Expense -$120

Take Home Pay $2,480

Commuter Benefits – Transit Only

Salary $4,000

Pre-Tax Transit Deduction -$120



Transit Expense -$0


Employees can save up to $620* per year!

* Estimate based on the maximum pretax contribution of $130/month for a transit benefit over the course of 12 months. Individual savings may vary based on contribution amounts, income, individual tax rates, state of residence and other factors.


And Save Even More: Transit + Parking

No Commuter Benefits

Salary $4,000

Deduction -$0



Transit & Parking Expense -$200


Commuter Benefits – Transit + Parking

Salary $4,000

Pre-Tax Transit Deduction -$200



Transit Expense -$0


Employees can save up to $1,825* per year!

* Estimate based on the maximum pretax contribution of $130/month for a transit benefit and $250/month for a parking benefit. Individual savings may vary based on contribution amounts, income, individual tax rates, state of residence and other factors. .


You Save Too!

• Ordinance requires companies to offer transit related benefits Parking and bicycle benefits aren’t required but they provide an

opportunity for additional savings

• Employers can save up to $350 per year in payroll taxes for every enrolled employee


Your Savings Grow as Employees Enroll

20 40 60$0

$5,000

$10,000

$15,000

$20,000

$25,000

Employer savings grow as the number of participants increases.*

* Calculations assume annual earnings of each participating employee is below the Social Security Wage Base of $118,500. Savings are for illustrative purposes only and assume all participants elect transit and parking benefits.


WageWorks


About WageWorksLeader in administering Consumer-Directed Benefits (CDBs) for health, commuter and other employee spending account

benefits in the U.S.

45,000*employer clients

4 million*employee program participants

4.5 million*prepaid WageWorks debit cards issued

* All numbers are approximate.


WageWorks Commuter BenefitsEveryone benefits from an easier, less expensive commute

• Leading provider of commuter benefits

• Comprehensive suite of products

• Leading edge technology

• Flexible product options, including TransitChek

• Easy to use

• World class customer service


Summary

• Companies with 20+ employees in New York City will be required to offer a pre-tax transit commuter benefit program

• WageWorks is an industry leader in commuter benefits and we’re here to help

• With WageWorks commuter benefits, compliance and savings are easy

• Sign up today and start saving now!

Questions?


Thank you.


For more information:www.wageworks.com/NYC-Commuter-Benefits


This material and the presentation provide general information only. Please consult with your legal and tax advisors regarding your own particular situation and circumstances.

IRS Circular 230 Disclosure: Internal Revenue regulations provide that, for the purpose of avoiding certain penalties under the Internal Revenue Code, taxpayers may rely only on opinions of counsel that meet specific requirements set forth in the regulations, including a requirement that such opinions contain extensive factual and legal discussion and analysis. Any tax advice that may be contained in this presentation does not constitute an opinion that meets the requirements of the regulations. Any such tax advice therefore cannot be used, and was not intended or written to be used, for the purpose of avoiding any federal tax penalties that the Internal Revenue Service may attempt to impose. You should seek advice based on your particular circumstances from an independent tax advisor.

wageworks nyc ordinance webinar

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