Commuter benefits do roll over from month to month, and they keep rolling as long as you stay employed. There’s no annual use-it-or-lose-it deadline on a pre-tax transit or parking account, and no cap on how large the balance can grow. The one hard cutoff is your last day on the job: any unspent pre-tax money is forfeited when you leave, and it cannot be refunded as cash or moved to a new employer’s plan.
How Rollover Actually Works
Federal tax law caps how much you can put into a commuter account each month, not how much can sit in it. For 2026, the monthly ceiling is $340 for transit (bus, rail, ferry, or vanpool) and $340 for qualified parking.1Internal Revenue Service. Publication 15-B (2026), Employer’s Tax Guide to Fringe Benefits Contribute $340 for transit but spend only $250, and the leftover $90 carries into next month. Do that repeatedly and the balance can climb well past the monthly limit.
The regulation governing these accounts requires only that you be a current employee when the benefit is provided. It contains no mechanism for expiring accumulated funds.2eCFR. 26 CFR 1.132-9 – Qualified Transportation Fringes
This is the biggest practical difference between a commuter account and a health care FSA. FSAs fall under cafeteria plan rules with a statutory year-end forfeiture. Commuter benefits sit under a separate section of the tax code with no such requirement, which is why your employer can legally let a balance ride for years.3GovInfo. 26 USC 132 – Certain Fringe Benefits
The Real Deadline Is Your Last Day
Every dollar of rollover flexibility vanishes the moment you stop being an employee. The regulation is blunt: qualified transportation fringes may be provided only to current employees.2eCFR. 26 CFR 1.132-9 – Qualified Transportation Fringes Once you resign, retire, or get laid off, two things happen at once:
- You can’t use the remaining funds for any commuting expense you incur after your last day. The benefit is tied to active employment, not to having a balance.
- You can’t get the money back as cash. The contributions were never taxed, and paying them out as a check would create a tax violation.
There’s no COBRA-style continuation. COBRA covers group health plans, not transportation fringe benefits.1Internal Revenue Service. Publication 15-B (2026), Employer’s Tax Guide to Fringe Benefits And there’s no portability the way there is with a 401(k). Whatever sits in the account at separation is forfeited, and the money generally reverts to the employer or the plan.
Claims for Expenses You Already Paid
One narrow exception catches many people off guard. If you paid for qualifying commuting costs while still employed but never filed for reimbursement, most plans give you a window after your last day to submit those receipts. This is called a run-out period, and it exists specifically for expenses already incurred during active employment.
The length depends on your employer’s plan document. Many administrators set it at 90 days after termination, though some allow more time and some less. The expense itself has to have been incurred and paid while you were on payroll. You can’t buy a transit pass the week after you leave and submit it during the run-out window. Once that window closes, the balance is gone permanently.
If you have old transit or parking receipts from your final months that you never turned in, gather them now. That’s the only realistic way to recover value from the account after separation.
How to Spend the Balance Down Before You Leave
If you know a resignation or retirement is coming, act early rather than at the end. A few practical steps:
- Log into your benefits portal and reduce or stop future contributions so the balance doesn’t keep growing while you drain it.
- If your plan allows it, buy multi-month transit passes or load a transit card before your termination date. Passes purchased while you’re still employed are yours. Be aware, though, that if your employer provides passes for months after your departure, the value of those later months could be treated as taxable income.2eCFR. 26 CFR 1.132-9 – Qualified Transportation Fringes
- If your plan covers qualified parking and your garage accepts advance payment, prepay several months using your commuter card.
- File every outstanding reimbursement claim before your last day rather than counting on the run-out period.
Eligible expenses are transit passes (bus, subway, rail, ferry), vanpool costs in vehicles seating at least seven people including the driver, and qualified parking at or near your workplace or at a location from which you commute by transit or vanpool.3GovInfo. 26 USC 132 – Certain Fringe Benefits Rideshare, gas for a personal car, and tolls don’t qualify.
Post-Tax Contributions Are Treated Differently
Some plans accept both pre-tax and post-tax contributions, and the two are handled separately at termination. Pre-tax dollars are forfeited because refunding them would create a tax problem. Post-tax dollars were already taxed when they came out of your paycheck, so if your plan holds any post-tax balance, those funds are typically refunded to you after a waiting period.
Ask your plan administrator whether your account contains post-tax money. This matters most for employees whose commuting costs vary, since some plans automatically switch contributions to post-tax once the monthly pre-tax limit is hit.
The Date on Your Card Is Not an Expiration Date
The “valid thru” date on your commuter debit card is a card-network fraud measure, not a deadline on your money. When the card reaches that date the plastic stops working, but the account balance behind it is unaffected.
Contact your benefits administrator before the card expires and request a replacement. Some send new cards automatically; others wait for you to ask. Replacement fees vary but are generally modest. As long as you’re still employed, the funds stay available regardless of what the card says.