COVID–19 Commuter Benefits Distribution Act

In the case of any qualified payment from a specified transportation fringe benefit account—

(1) such qualified payment shall be includible in the gross income of the employee for the taxable year in which such qualified payment is made, and

(2) the determination of whether any other payment from such account is a qualified transportation fringe for purposes of section 132 of the Internal Revenue Code of 1986 shall be determined without regard to such qualified payment.

For purposes of this section, the term qualified payment means a one-time payment made during the 6-month period beginning on the date of the enactment of this Act from a specified transportation fringe benefit account to the employee for whose benefit such account is maintained but only to the extent that such payment does not exceed the highest balance of such account during the period beginning on March 13, 2020, and ending on December 31, 2023.

For purposes of this section, the term specified transportation fringe benefit account means, with respect to any employee, amounts set aside by such employee’s employer under a compensation reduction agreement which—

(1) provides for payments to such employee of amounts which are excludible under section 132 of the Internal Revenue Code of 1986 as a qualified transportation fringe (determined after the application of subsection (a)), and

(2) provides that unused amounts at the end of a month may be carried forward to the succeeding month (subject to such requirements or limitations as such agreement, the Secretary of the Treasury, or the Secretary’s delegate, may provide).