Recent IRS Notice 2016-6 provides special procedures for employers to reflect the increase in the transit pass (and commuter highway vehicle) limit from $130 to $250, retroactive to January 1, 2015, to mirror the parking limit under Code section 132(f), in light of the recently enacted Consolidated Appropriations Act. This procedure largely tracks guidance issued last year ¯ Notice 2015-2 ¯ to help employers avoid the rather onerous process of issuing corrected forms (Form W-2c and 941-X) to reflect the proper amount of taxable wages. As the Form 941-X filing deadline (and the W-2 furnishing deadline to employees) is fast approaching, employers are encouraged to follow this streamlined process to reflect the reduction in taxable wages on the Form W-2 and fourth quarter Form 941, and refund any excess FICA taxes (including the additional .9% FICA amounts). The Notice is attached.
If you have any questions regarding the increase or the impact it has on your reporting obligations, please contact your regular Groom attorney or one of the attorneys listed.
