BA-9 Qualified Parking Permits

Purpose
The purpose of this policy is to establish a Qualified Parking Plan in accordance with Section 132(f) of the Internal Revenue Code. This plan will exclude taxable income amounts that pay for qualified parking benefits. The College plan includes eligible employee deductions for parking permit fees on a pre-tax basis through payroll deduction.

Scope
This policy and plan applies to administrative/professional (exempt), classified service, full-time and adjunct faculty who purchase College parking permits through payroll deductions. Eligible employees will be covered automatically by the policy and plan unless they elect to opt out of the plan in writing. This policy does not apply to hourly and student employees, as they are not eligible for voluntary payroll deductions.

Definition
IRS: Internal Revenue Service

Pre-tax: Not subject to federal income tax, social security tax, or Medicare tax.

Qualified Parking:A College purchased parking permit that falls within the current exclusion limit as defined by the Internal Revenue Code.

Policy
The College shall offer a Qualified Parking Plan in accordance with IRS regulations that will allow eligible employees to make payment for parking permit fees on a pre-
tax basis through payroll deduction.

Federal tax law prohibits refunds of pre-tax qualified parking deductions. Employees are not entitled to parking refunds upon termination of employment.

An eligible employee may opt out of the plan and choose not to purchase a parking pass on a pre-tax basis. Employees who opt out for the Qualified Parking Plan have the option to purchase a parking pass on an after tax basis, and must sign a Qualified Parking Plan Opt-Out form which will be kept on file in the Payroll office.

Procedure
Employee:

  1. An employee who purchases a parking permit shall complete a Parking Permit Payroll Deduction form to authorize a parking payroll deduction.
  2. An employee who authorizes a payroll deduction under this plan must certify that he/she is a current eligible College employee.
  3. Adjunct faculty may only purchase parking permits for the current quarter employed.

Payroll:

  1. Payroll will set up pre-tax payroll deductions from the employee's paycheck at the next available payroll after receipt of the Parking Permit Payroll D education form.
  2. The deduction will be in equal increments for the period of the pass purchased: annual, fall, winter, spring and summer quarter.
  3. If the employee is not in receipt of a paycheck anytime after the parking pass purchase, the deduction will be held in suspense until the employee receives their next paycheck, at which time the suspended deductions will be taken.

Specific Authority
IRS “Publication 15” B Employer's Tax Guide to Fringe Benefits
Code of Federal Regulations 26 CFR Section 1.132.9, Qualified Parking, p. 610
IRC 132(f), Qualified Transportation Fringes, Qualified Parking. page 21
State of Washington Office of Financial Management (OFM) Qualified Parking Approval Memo, dated March 23, 2004 (see Shirley Archuleta for copy of memo)

Law Implemented

History of Policy or Procedure
Draft: February 16, 2010
Adopted: June 10, 2010
Revised:
Reviewed by:
Contact: Shirley Archuleta, Payroll Manager, ext. 3495
President's Staff Sponsor: Rick Brumfield, Vice President for Business Affairs, ext. 3305