03/07/2019

Walker, Suozzi Introduce UBIT Repeal Bill

The bill is a companion to Senate legislation introduced last week

Reps. Mark Walker (R-NC) and Tom Suozzi (D-NY) introduced a bill March 5 to repeal the unrelated business income tax on certain employee benefits provided by associations and other tax-exempt organizations.

The bill is a companion to legislation introduced last week by Sens. James Lankford (R-OK) and Chris Coons (D-DE).

The tax on nonprofit fringe benefits, like parking and mass transit assistance, was implemented as part of the 2017 Tax Cuts and Jobs Act (TCJA). The tax is proving to be a huge burden for the nonprofit community, including churches and small charities that have little or no experience dealing with the IRS and insufficient guidance on how to calculate the value of parking and other benefits provided to their employees. OSAE, ASAE and the UBIT Coalition have been advocating for repealing the tax for more than a year.

“Churches and charities serve on the frontline of our battle against the generational cycles of poverty and the traps of government dependence,” Walker said. “Washington should ensure their work in our communities is not restricted by unnecessary taxes and strenuous compliance processes.”

Multiple bills to repeal the nonprofit benefits tax have been introduced in the 116^thCongress, and participants in American Associations Day on March 28-29 will advocate for passing UBIT repeal legislation.

“Bipartisan support is growing to repeal this onerous tax on nonprofit employee benefits,” said ASAE President and CEO John Graham, FASAE, CAE. “These new tax liabilities create numerous compliance challenges for nonprofits and threaten the financial security and missions of organizations that provide countless services to communities in need and to society as a whole.”

This article was provided to OSAE by the Power of A and ASAE's Inroads.