A qualified Transportation/Parking Reimbursement Account allows employees to set aside a certain amount of money out of each paycheck into an account—before paying income taxes. During the year, employees are reimbursed from this account for qualified expenses such as parking, vanpooling, and transit passes. This account is very similar to a Flexible Spending Account, however, it does not include the “use it or lose it provision”—the funds roll over from one month to the next.
The company saves too – 7.65% (FICA match) on every dollar employees contribute to the plan.
San Francisco employers who have 20 or more employees must offer a TMA.