I want to share some really exciting news: Unrelated Business Income Tax (UBIT) and the PF excise tax changes are included in the massive budget bill that will likely pass the House today and the Senate this week.
“Church parking tax”: The 2017 tax bill imposed a 21% UBIT on transportation and parking that nonprofits provide to their employees. The budget bill will repeal this tax -- and it is retroactive so it’s as if it never happened. Once the bill passes, if you paid the UBIT tax you can file for a refund.
Private foundations Excise Tax: The PF excise tax is streamlined to 1.39% and will be effective when the bills gets signed. Under the current two-tiered rate, private foundations can be penalized with higher taxes when they give more during times of extraordinary need such as after natural disasters. This has been a disincentive that can reduce giving often when local communities’ needs are greatest.
There’s a small chance that something could change so we will update you once the bill is signed into law. We don’t want to celebrate yet, but we do want to thank all of our members who contacted their members of Congress to share their views on these issues. We didn’t win everything on our policy agenda this year, but we are very pleased with these changes especially given the intense partisanship on Capitol Hill.
This is a step in moving forward our policy agenda for the reinvigorated Council. We look forward to working with you to do lots more in 2020.
Vice President, Government Affairs & Strategic Communications