Commuter benefit laws in NJ, NYC and Philadelphia
Employers with workers in New Jersey, New York City, and Philadelphia face three overlapping commuter benefit mandates. A pretax election under the federal commuter benefit rule (§132(f)) is the option all three accept, but each jurisdiction has its own employer-size threshold and reporting requirements.
New Jersey (statewide)
New Jersey (N.J. Rev. Stat. §27:26A-22) requires employers with 20 or more employees to offer a pretax transportation benefit. Employees covered by a collective bargaining agreement are excluded. The law took effect in March 2020.
Penalties: $100 to $250 for a first violation if not cured within 90 days, then escalating.
New York City
The NYC Commuter Benefits Law applies to employers with 20 or more full-time non-union employees. Penalties: $100 to $250 for a first violation if not cured within 90 days. Notice requirements apply.
Philadelphia
Philadelphia's law covers employers with 50 or more covered employees (those averaging 30 hours a week in Philadelphia). Daily fines run $150 to $300 after a warning. See Commuter benefits compliance in Philadelphia for detail.
How the workforce maps
- A worker living in NJ and commuting to NYC is a covered employee under NYC's law (workplace-based).
- A worker living in NJ and commuting to a NJ worksite is a covered employee under NJ's law.
- A worker living in NJ and commuting to Philadelphia is covered under Philadelphia's law if they meet its 30-hour test.
Multi-state restaurant chains, healthcare systems, and retailers often have employees in all three jurisdictions at the same time.
One program, all three
Alice's §132(f) pretax election is the option all three ordinances accept, because each is structured around the federal rule. Eligible transit covers:
- NJ Transit
- PATH
- NYC subway and bus (OMNY)
- LIRR
- Metro-North
- SEPTA
- PATCO
Qualified parking at garages, lots, meters, and parking apps (including NJ-area parking apps) near each workplace is also eligible.
What Alice handles
Alice has no up-front employer cost and no manual open enrollment to manage. Employees don't pre-fund. The employer keeps a reserve amount in its Alice plan account; it belongs to the employer and is not a fee.
Setup starts with one call. Alice connects to 30+ payroll providers, including ADP, UKG, Paylocity, Paycom, Paychex, Toast, and others. Payroll deductions are coded to each state's tax treatment.
Recordkeeping
Each jurisdiction has its own recordkeeping window (typically three years). Alice retains contribution and spending records on the employer's behalf.
Talk to sales
Talk to sales: sales@thisisalice.com or (929) 552-4625.
Specific benefits, election rules, and run-out periods depend on your employer's plan design. Check with your HR team or plan administrator for details.
For the full list of eligible commuter expenses, see What parking and transit expenses are eligible? Eligibility is set by IRC §132(f).
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Alice does not provide tax, legal, or financial advice. Consult your own tax preparer, lawyer, or financial advisor for guidance specific to your situation.