Campus Life

Tax plan impacts employee parking fees

UNIVERSITY PARK, Pa. – The tax overhaul recently signed into law will have a minor impact on parking fees for Penn State employees.

Under the previous law, payroll deductions for parking fees were on a pre-tax basis, meaning that employees were not taxed on money used to pay for parking. Beginning with employees' January 2018 paychecks, parking fees will be a post-tax item.

Payroll deductions for the RIDEpass program will also move from a pre-tax basis to a post-tax item.

Lawrence Friedken, director of payroll and tax services, said the change would be minimal for employees. For example, an employee who pays $37 per month in parking fees might see a $4- to $5 reduction in net income per month. Friedken said the impact would vary, depending on an individual’s tax bracket and the amount paid for parking.

The changes do not affect students who pay to park on campus.

Last Updated January 5, 2018