City of Seattle Head Tax

The Employee Hours Tax or 'head tax' became effective July 1, 2007 and will tax your company $25 for each employee working in the City of Seattle. The City will bill employers for the tax in December with Business & Occupation taxes. Businesses may claim an exemption, thus reducing the tax owed, for each employee who commutes by non-drive alone modes 80% of the time.  Also, check with your tax advisor.
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Quick links:
  • Washington State B&O or Public Utility Tax Credit for Commute Subsidies 
  • Metro’s Pre-tax Commuter Benefit Toolkit has easy steps to a pre-tax commuter program, customizable forms, flyers, posters and useful links.
  • IRS regulations on Qualified Transportation Fringe Benefits see the 2001 Federal Register. (155KB .PDF).