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IRS Issues Guidance on Parking Expenses for Non-Profit Organizations
In Notice 2018-99, the IRS issued interim guidance on an issue that has vexed not-for-profit organizations since the passage of the Tax Cuts and Jobs Act (TCJA) in December of 2017. Under the TCJA, the payment of Qualified Transportation Fringes (QTFs) by not-for-profit organizations falls under unrelated business taxable income (UBTI) and is subject to a tax of 21%.
Zinner & Co. LLP Partner Susan Krantz, CPA, CGMA, was honored with a prestigious Rainmaker award as the Nonprofit Certified Public Accountant (CPA) member of the year.
Presented during the Rainmaker Companies’ annual SuperConference, held in Indianapolis from May 31 through June 2, the award is given annually to a member best described as someone who is a constant source of value to other members. Other criteria include an individual who engages in group activities and contributes to the success of the alliance through leadership, collaboration and the sharing of resources and best practices.
One Effect of the Recent Tax Reform on Not-for-Profit Organizations
By Howard J. Kass, CPA, CGMA, AEP®
As often as employers are maligned, there are times where they try to do the right thing for their employees. To be fair, many times, an employer may take an action or incur an expense that benefits its employees, knowing that the employer will benefit by a tax deduction for incurring an expense. In some cases, Congress encourages such behavior by explicitly permitting favorable tax treatment for certain programs.
One such case was a set of fringe benefits known as the “qualified transportation fringe” benefits that, in fact, received a double-barreled tax benefit for years, by virtue of Internal Revenue Code Section (IRC) 132(f)(5)(C). Under that section, employers were allowed to take a deduction for, among other things, qualified parking fringe benefits that they provided to their employees. What, exactly, was a qualified parking fringe benefit? Under IRC 132(f)(5)(C), “qualified parking” meant parking provided to an employee on or near the business premises of the employer, or on or near a location from which the employee commutes to work by transportation described in Code Sec. 132(f)(5)(A) (relating to “transit passes”), in a commuter highway vehicle, or by carpool.
Chris Valponi, CPA
Audit and Assurance Manager
Q: I volunteer as a Board member for a mid-sized not-for-profit. At times, I feel that I am just going through the motions of reviewing and approving the balance sheet or the Treasurer’s report during our monthly board meeting. Are there duties that I could take on to be a more effective board member?
Pat M. – Volunteer board member, Cleveland
Leaving a philanthropic gift to a charitable organization can be a rewarding experience, both for the donor and the designated organization.
The November 15th deadline for non-profit organizations is quickly approaching. This is the final due date for calendar year non-profit organizations that have taken advantage of the two extensions already available to them. This includes organizations that are required to file Form 990, Form 990EZ and the online filing of Form 990N. (Keep in mind that the 990N is only required to be filed electronically once every three years to maintain tax-exempt status).
After more than three years of debate, comment, and revision, the Financial Accounting Standards Board’s (FASB) much-anticipated Accounting Standards Update (ASU) 2016-14, Presentation of Financial Statements of Not-for-Profit Entities, was released on August 18, 2016.
The newly released ASU will change the way all not-for-profits (NFPs) classify net assets and prepare financial statements. To view the standard in its entirety, visit the FASB's website here.
Adoption of FASB ASU 2016-14 will result in significant changes to financial reporting and disclosures for NFPs. FASB believes the update will improve NFP financial statements and provide more useful information to donors, grantors, creditors, and other financial statement users. The standard is effective for annual financial statements issued for fiscal years beginning after December 15, 2017 and for interim periods within fiscal years beginning after December 15, 2018.
If you have a question about your not-for-profit financial reporting, contact us. We're ready to meet with you and start the conversation. Email email@example.com or 216.831.0733.