Bicycle commuter benefit tax exemptions
Bicycle commuter benefit tax exemptions (commonly referred to as "bicycle commuter benefits") are policies that allow employers to provide a reimbursement to employees for the purposes of commuting to work by bicycle. Since 2009, the United States federal government has maintained a bicycle commuter benefit allowing employers to reimburse employees up to $20 per month exempt from the application of income taxes for reasonable bicycle commuting related expenses. Employers and employees find these tax exemptions favorable because there is no tax penalty on the transaction and employees are able receive untaxed reimbursements for bicycle helmets, locks, parking, general maintenance and other expenses. This policy does not preclude additional subsidies and benefits provided by lower levels of government, however there are currently no known policies adopted by governments below the federal level in the United States. 
- Goal: Increase bicycle ridership.
- Goal: Increase the affordability of bicycle use.
- Goal: Increase the rates of bicycle transportation user comfort, convenience and satisfaction.
- Goal: Decrease the rate of automobile use.
- Goal: Decrease the rate of environmental damage from automobiles.
A government sees a need or social to diversify the modes by which its commuters are travelling and wishes to increase the number of commuters travelling by bicycle. A country, state, province, county, or local government desires to encourage commuting by bicycle. In order to do so, the government provides a financial mechanism for employers to provide employees with a monetary incentive. The incentive may take one of many forms including but not limited to a tax-free reimbursement from employers to employees or funding mechanisms for employers to otherwise subsidize the costs of cycling for employees. As a result of implementing this policy, the cost of commuting by bicycle is decreased and the convenience of doing so is improved.
Tradeoffs of implementing this policy may include:
- Increased bicycle congestion due to increased ridership.
- Increased injuries due to bicycle collisions, especially in places where there is not proper bicycle infrastructure.
- Minor loss of tax revenue due to tax exemptions.
- Difficult to enforce or verify bicycle ridership.
- Employers may be pressured to provide facilities such as bicycle parking and showers for employees.
If answered yes, the following questions indicate superior conditions under which the policy is more likely to be appropriate:
- Is it feasible and safe for employees in the jurisdiction to commute to work by bicycle?
- Is it likely that employees would shift their transportation mode choice to bicycle with financial incentives?
- Would the amount of the tax exemption required to shift commuter behavior result in an acceptable level of lost revenue?
- Are employers willing to support cycling as commuting mode and pay for the reimbursements of their employees?
- Does the jurisdiction have the administrative capacity to process and enforce the tax exemption?
The following questions should be considered when determining how to implement this policy:
- What dollar amount of employee bicycle expense reimbursement will have a significant effect on employees switching their transportation mode to bicycling?
- This amount depends entirely on the jurisdiction and local conditions.
- What types of expense will be eligible for reimbursement?
- These expenses are at the discretion of legislators, but common expenses include helmets, locks, and bicycle maintenance costs.
- The decision to include the cost of bikesharing services is also at the discretion of the legislature.
- What is the maximum amount of tax revenue lost or spent on this program?
- The amount is a product of the number of people that use the exemption and the amount of the tax exempt reimbursement.
- Should tax exempt bicycle reimbursements be mutually exclusive with other tax exempt commuter benefits?
- This decision belongs to the legislators with consideration for the cost impacts of this decision.
- Has adoption of: Limited.
- Notable entities who have implemented or adopted this policy include:
- Country of United States of America  - Provides tax-free reimbursement benefits of up to $20 per month per employee.
- Country of United Kingdom  - Provides a tax-free reimbursement benefits for any amount up to one-thousand pounds before special permission is required.
- Country of The Netherlands  - Provides a reimbursement for bicycle maintenance and reimburses commuters on a per kilometer traveled basis.
- Country of Belgium  - Provides a reimbursement for bicycle maintenance and reimburses commuters on a per kilometer traveled basis.
- Country of Germany  - Provides a reimbursement for bicycle maintenance and reimburses commuters on a per kilometer traveled basis.
- Advocates - Bicycle Transportation. Assumption: Incentivizes commuting by bicycle and reduces costs for those who do so. 
- Advocates - Smart Growth. Assumption: Is consistent with policies that give more transportation choices to people.
- Advocates - Urbanism. Cities in which multiple transportation modes prevail, especially carbon free ones like cycling, are more vibrant sustainable places.
- Advocates - Environmental Protection. Assumption: Increased numbers of individuals commuting by bicycle rather than automobile reduces carbon emissions and other environmental damage caused by driving.
- Constituent Groups - Commuters. Assumption: Commuters benefit from having more commuting choices and lower costs for each of those choices.
- Advocates - Fiscal Conservatives
- Associations - Automobile Manufacturers
- Constituent Groups - Automobile Clubs and Owners
- Government Agencies - Transportation
- Labor Unions - Parking Attendants
- Pedaling toward a More Equitable Tax-Ride for Cyclists. Shoulberg, Jennifer L. (2010). St. Louis University Law Journal, Vol. 55, issue 1, 423-456. Discusses how the federal tax code favors modes of transportation other than bicycling.
- The Societal Costs and Benefits of Commuter Bicycling: Simulating the Effects of Specific Policies Using System Dynamics Modeling. Macmillan, Alexandra. Connor, Jenny. Witten, Karen. Kearns, Robin. Rees, David. Woodward, Alistair. (2014). Environmental Health Perspectives. 2014 Apr; 122(4): 335–344. doi:10.1289/ehp.1307250 The article reviews the societal costs and benefits of commuting by bicycle broadly in terms of health, efficiency, and environmental outcomes.
- If You Build Them, Commuters Will Use Them: Association Between Bicycle Facilities and Bicycle Commuting. Nelson, Arthur. Allen, David. (2014). Transportation Research Board, Vol. 1578. doi:10.3141/1578-10 This article explores the connections between bicycling amenities and commuters' use of them.
- Change and Continuity in Fringe Benefit Taxation: Seeking Sense and Sensibility. Kaplan, Richard L. Price, Dawson J. (2014-2015). New York Law School Law Review, Vol. 59, Issue 2 (2014-2015), 281-304. This article examines fringe benefit taxation programs like the existing commuter benefits programs currently maintained by the United States federal government.
- DOT Bicycle Benefit Policy. (2010). U.S. DOT discusses the Bicycle Commuter Act and the mechanics of how the policy works.
- WageWorks Bicycle Reimbursement Program. (2014). Document displays an example of an employer providing bicycle subsidies under the federal government's program.
- Bicycle Subsidy Benefit Program. Facilitates access to forms for the Bicycle Commuter Act program.
- Employer's Tax Guide to Fringe Benefits. (2016). Guide provides employers with information to all fringe benefits including bicycle and other transportation subsidies.
- Bicycle Commuter Benefit. McLeod, Ken. The League of American Bicyclists. 2015.
- . Moses, Stacey. The Blog of Bicycle Accessory Experts. 2010.
- . Bartunek, Robert-Jan. Reuters. 2011.
- . Buehler, Ralph; Hamre, Andrea. 2014.
- Complete Streets Smart Growth America. 2016.
- WHY BIKES ARE A SUSTAINABLE WONDER. Sorensen, Eric. Sightline Institute. 2008.