The Tax Cuts and Jobs Act enacted in 2017 imposed a parking tax under I.R.C. Section 512(a)(7). This parking tax has been retroactively repealed under the Taxpayer Certainty and Disaster Tax Relief Act signed into law on December 20, 2019.
This Act retroactively repeals for tax-exempt organizations the unrelated business income tax on disallowed fringe benefits. This means many not-for-profits no longer owe this tax and will be owed refunds of amounts related to this tax that were reported and paid on Form 990-T over the past two years.
The 2019 Act also simplifies the private foundation excise tax on investment income by replacing the two-tier system (1% and 2%) with a flat rate of 1.39%. The new rate is effective for tax years beginning after December 20, 2019.
If you have any questions on this issue, you can reach Allison Harrell directly at firstname.lastname@example.org or 850-668-8100.
Allison Harrell is a CPA, shareholder, and not-for-profit team leader with the public accounting firm Thomas Howell Ferguson P.A. CPAs.