Employers who develop and support their own employee transit programs may apply for a state corporate tax credit for a portion of the expenses incurred to make alternative modes of transportation available to their employees.
For tax years beginning on or after Jan. 1, 2002, the credit amount is 10% of commuter transportation benefits provided, up to a maximum ceiling amount. The credit ceiling is adjusted annually for inflation and may be claimed during accounting and privilege periods ending not later than December 31, 2007. For 2003, the maximum credit is $124.
An employer must fulfill two requirements:
1. Submit a Smart Moves for Business Program Narrative, a brief annual report to the New Jersey Department of Transportation (NJDOT). The Smart Moves for Business (SMFB) program narrative is a brief, three-page form to list the SMFB services the employer offers, the annual cost of providing the services and the number of participating employees.
2. Complete New Jersey Division of Taxation Form #307, Smart Moves for Business Program Ride Share Tax Credit Form, and file it with the corporate tax return.
Eligible expenses fall into the following five categories:
Administrative costs, such as personnel costs (salary, benefits, and training, but not overhead) for an Employee Transportation Coordinator and others with an administrative function for an employee transportation program, and costs to hire outside agencies to provide administrative services
Facilities/vehicle costs, such as invoice cost of capital improvements to add or upgrade facilities that support commute alternatives, for example, bike racks and showers, information display racks, and vans and other vehicles used for ridesharing.
Financial incentives costs, direct expenditures, such as ongoing or occasional subsidies, provided by an employer to employees using commute alternatives.
Marketing costs, supply and salary costs directly related to promotion of alternative modes of transportation to employees, including salary and benefits for in-house staff developing promotions and promotional materials, and the costs of contracting with outside agencies to provide these services.
Other program services costs, other eligible expenses, as approved by NJDOT, such as costs of providing emergency ride home through an outside vendor as well as the cost of obtaining ride-matching services.