Originally Posted by
Tpinks
yes it was supposed to say gross.
We had the commuting stipend last year, everything was paid for by the company and receipts had to be turned in. Our W2’s did not include any type of mention of a stipend or anything to show non taxed income. So now that this is transferred into rates, it changes taxes in a major way.
Yes I’m getting 590 gross more per month but my taxable gross income has risen 2590 more per month. That is where the loss occurs.
At the end of the day, people can argue what is and isn’t taxable forever. However, the way company did it last year, there was zero accounting on the pilots side on their W2’s showing any kind of stipend. However, that will change with this new program as they have to somehow show the withholding as a reduction from someone’s normal hours worked and for that reason most people I have talked to has withdrawn from the Divy program.
as for being comparable to other’s rates… we are only just now comparable to everyone’s 2019/2020 rates. Everyone is in negotiations. Even Avelo is paying slightly more AND still giving a $1800 month commuting stipend on top of those rates.
That makes it clear, and I see where that could lead to less net pay. And I definitely hope you get better rates.
Having said that, as far as the taxability, IMO you should have tracked how much the company refunded you, and added that to your taxable income as a fringe benefit when filing. When you didn't include that money, you in effect deducted those expenses from your taxable income. And according to the IRS: "The new law also disallows deductions for expenses associated with qualified transportation fringe benefits or expenses incurred providing transportation for commuting." (2017 Tax Cuts and Jobs Act).
Not sure how you could argue with that....