Parking Cash Out
Employers may establish a "parking cash out" program whereby employees may choose to "cash out" the value of employer-provided parking, forego parking and receive the taxable cash value of the parking or receive a tax-free transit or vanpool benefit of up to $125 per month. If the employee accepts cash instead of a tax-free transit or vanpool benefit, then the employee will have to pay payroll and income tax on the amount and the employer will incur payroll taxes on the cash value.
Parking cash out works like this: the employer establishes a monthly value for a parking space at its site. Each employee could then choose among various commuting options in the following manner: