BONUS! TAX SAVINGS

BONUS! provides tax savings to both employees and employers.  As a fringe benefit program, BONUS! benefits are not considered taxable income to the employee but are a tax-deductible expense for the employer.  To give the same after-tax value of a $30 BONUS! Bus Pass Benefit would require a raise of about $40, which would cost the employer $45 after all payroll taxes are included.  BONUS! benefits are a fully deductible business expense at both the federal and state level, which means an employer pays less than the full face value.

When BONUS! benefits are purchased with employees’ pre-tax payroll deduction, employees save up to 40 percent of the cost of a bus pass by avoiding federal, state, Social Security and Medicare taxes.  Employers save money from reduced payroll taxes (comprised of employer-paid FICA, Medicare, unemployment, worker’s compensation, disability pension, or other payroll driven costs), which amount to approximately 10 percent.  TheBus has developed a program that is easy to administer and the recordkeeping is simple.