Hitting the skids: Bike-sharing will be taxed

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in Small Business Tax,Small Business Tax Deduction Strategies

In a new private ruling, the IRS says that reimbursements given to employees as part of a bike-sharing program aren’t tax-free. Employers may provide a tax-free monthly benefit of up to $20 to cover expenses of biking to work—including the bicycle’s cost and any repairs or storage costs—but this exemption doesn’t apply to bike-sharing programs.

Therefore, all bike-sharing reimbursements are subject to both income and payroll taxes. (IRS Information Letter 2013-0032, 9/27/13)

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