54A:6-23 Commuter transportation benefits not considered gross income.

1. a. For the purposes of the "New Jersey Gross Income Tax Act," N.J.S.54A:1-1 et seq., "gross income" shall not include employer provided commuter transportation benefits as defined pursuant to section 3 of P.L.1992, c.32 (C.27:26A-3), up to and including the limit per taxable year per employee pursuant to subsection b. of this section. Should an employee receive commuter transportation benefits in excess of those limits in a taxable year, only the amount in excess of those limits shall be included in gross income. If an employee receives money towards commuter transportation benefits from the employee's employer, as an advance, a reimbursement, or both, the employee shall furnish suitable proof to the employer in the form of receipts, ticket stubs or the like that the employee used the employer provided money for alternative means of commuting as defined pursuant to section 3 of P.L.1992, c.32 (C.27:26A-3).

b. (1) The limit per taxable year per employee shall be $720 for the taxable years beginning on and after January 1, 1993 but before January 1, 1997.

(2) The limit per taxable year per employee shall be $1,000 for the taxable years beginning on and after January 1, 1997 but before January 1, 2002. For taxable years beginning on or after January 1, 1994 but before January 1, 2002, the director shall adjust the limit, rounded down to the nearest $5, in proportion to the change in the average consumer price index for all urban consumers in the New York and Northeastern New Jersey and the Philadelphia areas, as reported by the United States Department of Labor, from calendar year 1993 to the calendar year ending immediately before the taxable year.

(3) The limit per taxable year per employee shall be $1,200 for the taxable years beginning on or after January 1, 2002, provided however that in the case of any taxable year beginning in a calendar year after 2002 the director shall adjust the limit for inflation in parallel with the adjustment pursuant to paragraph (6) of subsection (f) of section 132 of the federal Internal Revenue Code of 1986, 26 U.S.C. s.132, so that the taxable year limit pursuant to this paragraph is equal to 12 times the adjusted federal monthly limit pursuant to subparagraph (A) of paragraph (2) of subsection (f) of section 132 of the federal Internal Revenue Code of 1986, 26 U.S.C. s.132.

c. The exclusion provided by subsection a. of this section shall not apply to any commuter transportation benefit unless such benefit is provided in addition to and not in lieu of any compensation otherwise payable to the employee.

d. Acceptance of the cash value of qualified parking, pursuant to section 132 of the federal Internal Revenue Code of 1986, 26 U.S.C. s.132, on the part of one employee of an employer in place of qualified parking fringe benefits provided to the other employees of the employer in addition to and not in lieu of compensation, shall not cause the qualified parking fringe to become a taxable benefit for employees who do not accept the cash value.

L.1993,c.108,s.1; amended 1996, c.121, s.7; 2001, c.162, s.2.