Bicyclist Bailed Out

by Melissa Bailey | October 2, 2008 10:46 AM | | Comments (5)

Embedded in a sweetened bailout bill the U.S. Senate passed Wednesday is a perk for those who pedal their way to work. A benefit for bicycle commuters is among a slew of tax breaks that the Senate added to its bailout package to try to encourage passage through the House.

The legislation calls for a maximum $20 per month reimbursement from employers to bicycle commuters. The bike commuting benefit would cost the government an estimated $10 million over 10 years, according to Senate finance committee staff.

The bikers’ benefit comes from Charlie Rangel’s (D-NY) H.R. 6049 (the Energy Improvement and Extension Act of 2008), which was approved by the Senate on Sept. 23, and attached Wednesday to the the economic rescue package. The House is set to vote on the bailout package Friday.

See the text of the bike-commuting clause below:

SEC. 211. TRANSPORTATION FRINGE BENEFIT TO BICYCLE COMMUTERS.

(a) IN GENERAL.—Paragraph (1) of section 132(f) is amended by adding at the end the following: “(D) Any qualified bicycle commuting reimbursement.”.

(b) LIMITATION ON EXCLUSION.—Paragraph (2) of section 132(f) is amended by striking “and” at the end of subparagraph (A), by striking the period at the end of subparagraph (B) and inserting “, and”, and by adding at the end the following new subparagraph: “(C) the applicable annual limitation in the case of any qualified bicycle commuting reimbursement.”.

(c) DEFINITIONS.—Paragraph (5) of section 132(f) is amended by adding at the end the following: “(F) DEFINITIONS RELATED TO BICYCLE COMMUTING REIMBURSEMENT.—

* “(i) QUALIFIED BICYCLE COMMUTING REIMBURSEMENT.—The term ‘qualified bicycle commuting reimbursement’ means, with respect to any calendar year, any employer reimbursement during the 15-month period beginning with the first day of such calendar year for reasonable expenses incurred by the employee during such calendar year for the purchase of a bicycle and bicycle improvements, repair, and storage, if such bicycle is regularly used for travel between the employee’s residence and place of employment.
* “(ii) APPLICABLE ANNUAL LIMITATION.—The term ‘applicable annual limitation’ means, with respect to any employee for any calendar year, the product of $20 multiplied by the number of qualified bicycle commuting months during such year.
* “(iii) QUALIFIED BICYCLE COMMUTING MONTH.—The term ‘qualified bicycle commuting month’ means, with respect to any employee, any month during which such employee—
o “(I) regularly uses the bicycle for a substantial portion of the travel between the employee’s residence and place of employment, and
o “(II) does not receive any benefit described in subparagraph (A), (B), or (C) of paragraph (1).”.

(d) CONSTRUCTIVE RECEIPT OF BENEFIT.—Paragraph (4) of section 132(f) is amended by inserting “(other than a qualified bicycle commuting reimbursement)” after “qualified transportation fringe”.

(e) EFFECTIVE DATE.—The amendments made by this section shall apply to taxable years beginning after December 31, 2008.







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Comments

Posted by: anon | October 2, 2008 11:55 AM

Where do they get the figure that this tiny tax break will cost the government $10 million? For a variety of reasons, even a marginal increase in bicycle or pedestrian commuting nationwide could save the country tens of billions of dollars in reduced road construction, oil importing, transportation and health care costs, not to mention long-term environmental costs.

Individually, families would save even more, allowing them to afford much higher taxes, better health care, higher education, or higher rents instead of seeing their incomes siphoned off to foreign dictatorships (Russia, Venezuela, Saudi Arabia, Sudan).

Does the government think that this tax break will have no effect? If not, then why are they doing it?

Realizing the lopsided benefit-to-cost ratio at play here, some other countries actually pay people to commute by bicycle or on foot. That's the model that the U.S. should adopt -- not a small tax break.

Environmental advocates have nothing against driving, but a carrot approach is needed when you're talking about such a huge benefit for the entire country.

Once again, it's a case of national leaders having no long-term vision.

Posted by: Westville Mom | October 2, 2008 1:51 PM

Why not help the bikers? We're helping EVERYBODY else (like the co. that makes wooden arrows.) As usual, we're especially helping the folks in Samoa (I believe they said $30 million), who benefit from practically every bill Congress passes. Who is in Samoa? StarKist Tuna, which is owned by Del Monte, which is headquartered in San-Fran Nan's district. That's why they were the only U.S. territory EXEMPTED from the new minimum wage requirement. Hopefully, a Pres. Obama will shrewdly recognize the (domineering/controlling) threat San Fran Nan poses and push her out of the Speaker's chair--or risk becoming her puppet-president. (Might we have a de facto female president, after all?)
But back to benefits for "enery improvement"---when can I expect a tax break for all the airplane flights I DON'T take?...(not holding my breath on that.)

Posted by: anon | October 2, 2008 2:26 PM

Agree, Westville Mom! Look at the special language in the 400 page bill. Millions of cyclists are getting $10 million ($20!), while depleted oil wells owned by a handful of rich few are getting writ off the tax rolls to the tune of hundreds of millions.

Posted by: Don | October 2, 2008 7:51 PM

What a great idea! Bikes offer fun and fitness in addition to all the environmental and economics benefits. For those who are not fit enough, go electric! www.zclipse.com

Posted by: Walt | October 4, 2008 11:56 AM

What a waste, the bicyclists, the wooden arrow makers, NASCAR and the other ridiculous junk added to the Bill in the Senate..

The added federaal deposit insurance and the mental health insurance provisions seem to make sense to me although completely unrelated to the problems this measure is supposed to solve.
.

Maybe the feds are now going to pay for the Q Ave sidewalks or erecting permanent memorials to those killed in the Boulevard drag races or will send flowers on behalf of Barney Franks or Gary Studds, but with our money, when Ned gets "married".

The House added some needed controls, but I doubt if any one person in the whole Country knows what nefarious provisions were added to this legislation by the Senate.

We will learn over the years what slipped by, hidden there.

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