Originally Posted by Square & Compas

Ok, so bottom line. Does my employer HAVE to have a Section 132 Plan? Or can they pay me the $20.00 a month and claim it at the end of the year as a deduction for themselves? The way I read it a Section 132 Plan is a fund, similar to flex-spend medical plans, that employees would pay into, then get reimbursed from that. A Section 132 costs money for my employer to set up. As a result of this they are not going to do that this year. In fact they are looking at ways of custting costs with the economy being in the toilet right now. They just laid off 3 people in my dept this week.

So would it be cheaper for my employer to pay me the $20 for commuting to/form work on my bike and claim it at the end of the year as a deduction for themselves rather then pay my monthly parking rate and claim that as a deduction, without the use of a 132 Plan? Is a 132 Plan REQUIRED for this to work?

I am getting confused here and from what it seems receiving mixed info. Please dumb it down for me in simple terms. I am not a tax expert nor an expert in HR when it comes to how benefits work and how they are set up. I prefere yes and no answers, don't need a lot of fluff with the answer. If a further explaination is given please dumb it down for me. And the web links with the info., while appreciated are more confusing with the answers then what I receive here.