COVID–19 Commuter Benefits Distribution Act

The COVID-19 Commuter Benefits Distribution Act allows employees to receive a one-time tax-free payment from their employer-sponsored commuter benefit accounts to help cover transportation costs during the pandemic. This benefit is available to workers who have pre-tax savings in these accounts and is limited to the highest balance they held between March 13, 2020, and December 31, 2023. The legislation requires that this specific payment be treated as taxable income for the employee, while ensuring that the remaining funds in the account continue to qualify for tax-free use.