If commuter benefits aren’t on your radar yet, they probably should be. What used to be a “nice extra” is quickly becoming a compliance requirement—and a competitive advantage.

First: Are they required?

Short answer: sometimes, yes.

Several states and cities now require employers to offer commuter benefits once they hit a certain size—and that threshold is often just 20 employees.

Here are a few examples:

• Washington, D.C. – Employers with 20+ employees must provide at least one commuter benefit option.
• New Jersey – Employers with 20+ employees must offer a pre-tax commuter benefit (with limited exceptions).
• New York City – Employers with 20+ full-time employees must allow employees to pay for transit using pre-tax income.
• Philadelphia, PA – Employers with 50+ employees working ~30+ hours/week in the city must provide commuter transit benefits.
• San Francisco – Employers with 20+ employees nationwide must offer a commuter benefit program (pre-tax, subsidy, or employer-provided transit).
• Seattle – Employers with 20+ employees worldwide must offer pre-tax commuter benefits.

So if your company is growing, this can sneak up on you fast.

What exactly are commuter benefits?

At the most basic level, they allow employees to pay for things like public transit or parking with pre-tax dollars.

That means:

• Employees save money on commuting
• Employers reduce payroll taxes
• Everyone wins (rare, but it happens)

Why companies are adding them anyway

Even when it’s not required, companies are offering commuter benefits because:

• It’s low-cost (or cost-neutral)
• It’s easy to implement
• It supports return-to-office efforts without forcing it
• It actually gets used

The risk of doing nothing

Ignoring commuter benefits isn’t just a missed opportunity — it can turn into a compliance issue if you’re in (or hire into) a regulated location.

And with remote teams, that’s more common than people think. One employee in a city like NYC or D.C. can trigger requirements.

Bottom line

If you have around 20 employees (or plan to), this isn’t something to revisit “later.”

At minimum, make sure you’re compliant.
At best, you’re offering a simple benefit employees actually appreciate.

📞 Have questions about commuter benefits? Whether it’s pre-tax transit, parking, or employer-provided programs, we’re here to help you understand your options clearly and confidently. Contact us today.

Sources

• New Jersey Department of Labor and Workforce Development. “Commuter Benefits Law.” NJDOL, 2024, https://www.nj.gov/labor/worker-protections/earnedsick/commuter-benefits-law.shtml. Accessed 31 Mar. 2026.
• New York City Department of Consumer and Worker Protection. “Commuter Benefits Law.” NYC.gov, 2024, https://www.nyc.gov/site/dca/about/commuter-benefits-FAQs.page. Accessed 31 Mar. 2026.
• City and County of San Francisco. “Commuter Benefits Program.” SFGov, 2024, https://sf.gov/information/commuter-benefits-program. Accessed 31 Mar. 2026.
• District Department of Transportation. “Commuter Benefits Law.” DC.gov, 2024, https://ddot.dc.gov/page/commuter-benefits-law. Accessed 31 Mar. 2026.
• City of Seattle Office of Labor Standards. “Commuter Benefits Ordinance.” Seattle.gov, 2024, https://www.seattle.gov/laborstandards/ordinances/commuter-benefits. Accessed 31 Mar. 2026.
• City of Philadelphia. “Commuter Transit Benefit Program.” Phila.gov, 2024, https://www.phila.gov/programs/commuter-transit-benefit-program/. Accessed 31 Mar. 2026.

This content is provided for general informational purposes only and is not intended as legal, tax, or benefits advice. Rules and requirements for commuter benefits, including pre-tax transit, parking, or employer-provided programs, vary by city, state, employer size, and individual circumstances. Program details, contribution limits, eligibility, and compliance obligations may change at any time. Eligibility and benefit determinations are made by the employer or applicable government agency based on program documents and supporting information. Individuals should always consult their employer, plan administrator, or relevant government agency and review their specific program for the most accurate and up-to-date information.

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