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I have funds locked into a Commuter Parking account (withdrawn from my bi-weekly pay on a pre-tax basis) that I will never use. Typically, these funds can only be used on work-related parking expenses.

Is there any way for me to either:

A.) Move these funds back into my paycheck (I understand this would come with a standard income tax rate and a penalty), or

B.) Move these funds into my Commuter Transit account (I have this account open and is used regularly)?

Both of these accounts are voluntary benefits supplied by my employer.

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A.) Move these funds back into my paycheck (I understand this would come with a standard income tax rate and a penalty),

So from what I can tell from: 26 CFR § 1.132-9 - Qualified transportation fringes.

Q-14. When must the employee have made a compensation reduction election and under what circumstances may the amount be paid in cash to the employee?

Compensation reduction amounts not refundable.

Unless an election is revoked in a manner consistent with paragraph (c) of this Q/A-14, an employee may not subsequently receive the compensation (in cash or any form other than by payment of a qualified transportation fringe under the employer's plan). Thus, an employer's qualified transportation fringe benefit plan may not provide that an employee who ceases to participate in the employer's qualified transportation fringe benefit plan (such as in the case of termination of employment) is entitled to receive a refund of the amount by which the employee's compensation reductions exceed the actual qualified transportation fringes provided to the employee by the employer.

So per the tax code, any funds transferred into a qualified transportation plan can't be returned to the employee.

B.) Move these funds into my Commuter Transit account (I have this account open and is used regularly)?

From Rev. Rule 2014-32 on Qualified transportation fringes the closest clear statement about the separation of accounts is in the Situation 7 example:

Z’s smartcard includes separate accounts to separately track funds provided directly by an employer that are available only for transit use, funds provided directly by an employer that are only available for nontransit use (e.g., parking),

As most of the rules assign by month the compensation reduction, and focus on the fact that the account value can only be used for the specified benefit, the different categories of transit and parking have different value caps, so each type is considered "different" such that trying to transfer or co-mingle would seem to be against the rules.

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These transportation pretax accounts come with a risk. You can forfeit the funds because you are not supposed to use them after your last day of work. You can't get a refund, and you can't convert them.

Most programs place the funds onto a card that can only be used at specific types of businesses. The local mass transit system actually knows which funds are for transit and which are for parking and pulls from separate wallets on the same physical card.

The only advice I can give is to try and use them for legitimate purposes. Maybe you can drive some days and pay for parking near work. Or you could pick a different commuting method that comes with a parking fee. In the DC area the metro lots cost money but VRE train lots are free. If you carpool, offer to pay for parking.

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