IRS Clarifies When to Roll Over Unused Amounts from One Qualified Transportation Benefit to Another

On September 8, 2020, the IRS issued Letter Number 2020-0024 that addressed a question concerning whether an employee can roll over unused transit benefits into a parking account.

The IRS stated that, as a general proposition, such a rollover is possible provided that the parking benefit is a qualified parking benefit that is offered by the employer’s plan and that the amount rolled over does not result in a total amount that exceeds the maximum monthly limitation established for the respective qualified transportation fringe benefit.

Information letters are not legal advice and cannot be relied upon for guidance. Taxpayers needing binding legal advice from the IRS must request a private letter ruling. While the letter does not provide any new guidance, this letter does provide general information that may be helpful to employers with questions on this topic.

Letter Number 2020-0024 »