Repeal of section 512(a)(7) is retroactive to December 22, 2017
The 2017 tax reform bill included one provision that has frustrated not-for-profit organizations for the last two years: treating parking benefits to employees as taxable UBTI (unrelated business taxable income). In welcome news for not-for-profits, the 2019 consolidated appropriations act rolls back that provision, retroactive to December 22, 2017.
With this rollback, not-for-profits should be able to seek refunds for any tax paid on these benefits. The IRS has not issued any guidance or created a consolidated refund process, so organizations should watch for additional news or instructions.
If you have questions about this change or other tax issues affecting your organization, contact us. We’ll be glad to help!
Board members governing notorganizations can’t miss signs of financial distress such as losing funding sources, defaulting on loans or…