Friday, October 03, 2008

Bailouts and Bicycles

Exciting times here in the US and world financial markets.  The Bailout Bill, Part Deux is scheduled to be voted upon by the House today.  Will the market crash if the bill is rejected again?  Will Henry Paulson take over the world?  Only The Shadow knows.  One thing The Shadow may not be aware of is there is a bicycle component to the bailout bill.  Really!
Section 211 of the Senate Bailout bill (H.R. 1424) states:

    "(a) In General- Paragraph (1) of section 132(f) is amended by adding at the end the following:

    `(D) Any qualified bicycle commuting reimbursement.'.

    (b) Limitation on Exclusion- Paragraph (2) of section 132(f) is amended by striking `and' at the end of subparagraph (A), by striking the period at the end of subparagraph (B) and inserting `, and', and by adding at the end the following new subparagraph:

    `(C) the applicable annual limitation in the case of any qualified bicycle commuting reimbursement.'.

    (c) Definitions- Paragraph (5) of section 132(f) is amended by adding at the end the following:


      `(i) QUALIFIED BICYCLE COMMUTING REIMBURSEMENT- The term `qualified bicycle commuting reimbursement' means, with respect to any calendar year, any employer reimbursement during the 15-month period beginning with the first day of such calendar year for reasonable expenses incurred by the employee during such calendar year for the purchase of a bicycle and bicycle improvements, repair, and storage, if such bicycle is regularly used for travel between the employee's residence and place of employment.

      `(ii) APPLICABLE ANNUAL LIMITATION- The term `applicable annual limitation' means, with respect to any employee for any calendar year, the product of $20 multiplied by the number of qualified bicycle commuting months during such year.

      `(iii) QUALIFIED BICYCLE COMMUTING MONTH- The term `qualified bicycle commuting month' means, with respect to any employee, any month during which such employee–

        `(I) regularly uses the bicycle for a substantial portion of the travel between the employee's residence and place of employment, and

        `(II) does not receive any benefit described in subparagraph (A), (B), or (C) of paragraph (1).'.

    (d) Constructive Receipt of Benefit- Paragraph (4) of section 132(f) is amended by inserting `(other than a qualified bicycle commuting reimbursement)' after `qualified transportation fringe'.

    (e) Effective Date- The amendments made by this section shall apply to taxable years beginning after December 31, 2008."

To sum it up in plain english, employers of people who bicycle to work stand to gain a $20 per month tax credit per cycling employee.  So next time you're biking down the road and somebody honks their horn or flips you off, tell them you're saving the economy.  Because clearly, they're related.


WheelDancer said...

This is GREAT but I am a bit confused; the employer gets up to $20 per qualified month but how about the employee? Is that credit a pass-through to the person actually commuting by bike?


Apertome said...

It's just one of many completely irrelevant things added to the bill in an attempt to make it more palatable. I hate that Congress works this way, and I wish each part would just get its own bill, instead of this bloated crap.

That said, the bicycle commuting provisions sound nice, though I have the same confusion as wheeldancer.

Jim Thill said...

I understand it as a tax deduction for employers who reimburse employees for bike commuting expenses.

Tex69 said...

Oh, I was going to look into the newly-announced fat-ass pork added to the fat-ass bailout, but now that I see that it's an add-on for companies, I'm not so excited. My employer doesn't do @#$@# for my commute, and never will. Henceforth, useless pork, and I hate the sound of that.

Reflector Collector said...

Yet another reason around our house why we call it the "Kitchen Congress" When one of us wants one thing, rather than the other saying "No," it turns into "...yes, but I get..."

I doubt very much whether my employer will recognize this, nor do anything about it.

GolgiApparatus said...

These are some other views...the Velocipete comments are better though!!!