Can I Use Commuter Benefits for Gas?

Commuter benefits cannot be used to pay for gasoline in a personal vehicle. These employer-sponsored plans operate under Internal Revenue Service (IRS) regulations that define “qualified transportation fringe benefits.” The funds are set aside on a pre-tax basis, lowering an employee’s taxable income, but their use is strictly limited to eligible expenses outlined in the Internal Revenue Code.

Understanding Qualified Expenses

Commuter benefit plans are structured around specific categories of eligible expenses, and costs associated with a personal vehicle are explicitly excluded. The primary qualified expense is for transit passes, which includes fare cards, tokens, or vouchers for public transportation systems like buses, subways, trains, and ferries. These funds can be used to purchase monthly passes or load value onto a transit card for daily fares.

Another category of qualified expenses is vanpooling. For a vanpool to be eligible under IRS rules, the vehicle must be able to seat at least six adults, not including the driver. A substantial portion of its use, typically at least 80%, must be for commuting purposes, with the vehicle at least half-full of employees.

The final category is qualified parking, which covers certain parking fees. While parking can be a qualified expense, the costs of operating a personal vehicle, such as gasoline, tolls, car insurance, and routine maintenance, are never covered by commuter benefit funds. For 2025, the IRS allows employees to contribute up to $325 per month for transit and vanpooling expenses and a separate $325 per month for qualified parking.

How Parking Benefits Work

The funds can be used to pay for parking at or near your place of employment. This allows an employee who drives to work to pay for their garage or lot fees with pre-tax dollars, up to the monthly limit set by the IRS.

The benefit also extends to parking at a location from which an employee continues their commute using another form of qualified transportation. For example, if you drive your personal car to a train station and pay to park there before taking the train to your office, the parking fee at the station is an eligible expense.

While the fee for the parking spot at the train station is a qualified expense, the cost of the gasoline you used to drive your car to that station is not. The benefit is designed to cover the fee for the parking space itself, not the expenses incurred to get your vehicle to that space.