Tax Incentives

Employers who promote carpooling, vanpooling, bicycle commuting, flextime, or compressed workweeks may be eligible for State tax incentives.

Tax Credit

Employers that offer ridesharing to employees at their worksite are eligible for federal tax credits. Employers may deduct up to $100.00 per participating employee. The following expenses are eligible for the tax credit:

• Administrative costs - such as personnel costs (salary, benefits, training, but not overhead) for an Employee Transportation Coordinator and others with an administrative function supporting ridesharing, and costs to hire outside agencies to provide administrative services.
• Facilities/vehicle costs - such as invoice costs of capital improvements to add or upgrade facilities that support commute alternatives (bike racks, showers, information display racks, van or other rideshare vehicles).
• Financial incentive costs - direct expenditures, such as on-going or occasional subsidies, provided by an employer to employees using commute alternatives.
• Marketing costs - supply and salary costs directly related to the promotion of ridesharing, including salary and benefits for in-house staff developing promotions and promotional materials, and the costs of contracting with outside agencies to provide these services.
• Other program services costs - other eligible expenses, as approved by the NJ Department of Transportation, such as costs of providing Guaranteed Ride Home program, through an outside vendor and the cost of providing and obtaining ride matching services.

Questions about the eligible expenses may be directed to the Department of Taxation at 609-588-2200 or by visiting www.state.nj.us/treasury/taxation.