Elizabeth M. Mills
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Early on December 2, 2017, the Senate passed the Tax Cuts and Jobs Act (the “Senate Bill”). This blog entry describes certain provisions of the Senate Bill that would have the most significant impact on the nonprofit community, including important differences between the Senate Bill and the prior version of the Senate bill and the … Continue Reading
Over the last several days, there have been significant developments relating to the Tax Cuts and Jobs Act, the pending tax reform legislation in Congress.[1] On Thursday, a detailed summary of the Senate Finance Committee’s proposal was released (the “Senate Markup”),[2] and the House Ways and Means Committee voted (in a 24-16, party-line vote) to … Continue Reading
House Republican Tax Bill Imposes Excise Tax on Wealthy Private Universities and Excess Compensation of Highly Paid Employees; Subjects State Pension Plans to UBTI Rules On Thursday, November 2, House Republicans led by Speaker Paul Brady (R-WI) and Chairman of the House Ways & Means Committee Kevin Brady (R-TX), released the first public draft of … Continue Reading
The Protecting Americans from Tax Hikes (“PATH”) Act of 2015, enacted in December 2015, requires organizations to notify the IRS if they desire to operate under Section 501(c)(4) of the Internal Revenue Code (“Code”). (Only organizations described in Section 501(c)(3) of the Code are required to apply for and receive recognition of their tax-exempt status; … Continue Reading
Every January, the IRS releases a series of revenue procedures detailing how organizations can obtain private letter rulings and determinations and listing issues on which the IRS will not rule during the coming year. This year’s procedures make clear that tax-exempt organizations will no longer be able to receive a ruling or any comfort from … Continue Reading
On October 26, 2015, the IRS released final regulations under Sections 141 and 145 of the Internal Revenue Code concerning the use of property financed with tax-exempt bond proceeds. The bulk of the new regulations fill a long-reserved spot in Treasury Regulation Section 1.141-6 concerning allocation of bond proceeds to financed property. In addition, in … Continue Reading
As we previously reported, the IRS has updated its guidance with helpful examples concerning program-related investments for private foundations. In its recently issued Notice 2015-62, the IRS provides further assurance that private foundations may take the accomplishment of charitable purposes into account in investing decisions, in addition to financial return. Among other restrictions, private foundations … Continue Reading
On March 31, 2015, the Commissioner of the IRS reported in a speech to the National Press Club that the IRS is “under new management” due to major changes in management staff over the last few years. Many of these management changes, as well as changes in organization and procedures, were in the Tax-Exempt and Governmental … Continue Reading
As part of a series of papers outlining tax reform options for the Senate Finance Committee (SFC), the SFC staff recently published a paper on tax reform options for tax-exempt organizations and charitable giving. Like the other staff papers on tax reform options, the exempt organizations paper compiles suggestions that have been made by witnesses … Continue Reading
The IRS continues to implement the “three years and you’re out” rule for Form 990 non-filers added by the Pension Protection Act of 2006 (the “PPA”). That legislation amended Section 6033 of the Internal Revenue Code to provide that exempt organizations required to file a Form 990-series return (i.e., a Form 990, Form 990-EZ or … Continue Reading
The American Taxpayer Relief Act of 2012 (“TRA”) (H.R. 8) passed by the Senate on January 1, 2013, passed by the House of Representatives early on January 2, 2013 and signed by President Obama, in large part addresses income and other tax rates without direct effect on tax-exempt organizations. Several provisions, however, will be of … Continue Reading
On July 31, 2012, the IRS issued Notice 2012-52 (the “Notice”), providing long awaited confirmation that a charitable contribution to a limited liability company that is wholly owned by a charitable organization, and classified as a disregarded entity for U.S. federal income tax purposes (an “SMLLC”), will be treated as a contribution to a branch … Continue Reading
As previously reported, the Treasury Department released proposed regulations on June 22, 2012 interpreting and implementing specific requirements for hospitals to maintain their Section 501(c)(3) tax-exempt status under Section 501(r) of the Code. Section 501(r) was enacted as part of the 2010 Health Care Reform Act (the “Act”). … Continue Reading
As we have previously reported, the 2010 Health Care Reform Act imposed new, specific requirements for hospitals to maintain their Section 501(c)(3) tax-exempt status. … Continue Reading
A new provision which was slipped in to the annual announcement of procedures for exempt organization determinations and letter rulings provides a way for governmental entities to voluntarily terminate their Section 501(c)(3) status. This is important for governmental hospitals that otherwise could be faced with new exemption requirements and penalties.
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Along with making significant changes to the rules for supporting organizations ("SOs") and donor advised funds ("DAFs") in the Pension Protection Act of 2006 (the "PPA"), Congress directed that Treasury conduct a study on the organization and operation of SOs and DAFs. Congress gave Treasury one year after the enactment of the PPA to submit a report on the study. On December 5th, more than four years past the prescribed deadline, Treasury finally released its long-awaited report to Congress.
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As we have previously reported, the Affordable Care Act (the “Act”) included additional requirements for tax-exempt hospitals to maintain their tax-exempt status; these changes are effective for tax years starting after March 23, 2010, the enactment date of the Act. These additional requirements included Form 990 reporting obligations for hospitals, which required some adjustments to Form 990 … Continue Reading
In Mayo Foundation for Medical Education and Research v. United States , the U.S. Supreme Court upheld the validity of a Treasury Regulation that states that the student exception from FICA (Social Security and Medicare) tax does not apply to medical residents because they work at least 40 hours per week. Applying the deferential two-part standard … Continue Reading
Last week, the IRS and Treasury Department released their annual Priority Guidance Plan for the 2010-2011 federal fiscal year. The 34-page plan is available here. The IRS exempt organizations web page identifies and lists eighteen items in the plan that affect exempt organizations. Of the eighteen items, eleven were also included in last year’s plan – … Continue Reading
We have been closely following the medical resident FICA refund issue. As we noted in our blog entry in March on the topic, the IRS conceded that refund claims for FICA taxes for medical residents for the periods before April 1, 2005 will be paid. The IRS has now announced this month that it has begun sending letters to individual medical residents who filed individual claims for FICA refunds. These letters ask the individuals to submit copies of their claims.
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Many health care and medical education institutions have claims pending with the IRS for refunds of the FICA (Social Security and Medicare) tax paid on wages for employed medical residents. The issue for these claims is whether the residents are "students," and their wages accordingly exempt from FICA tax, for purposes of the student FICA exception in the Internal Revenue Code.
Last summer, the Eighth Circuit Court of Appeals held that this regulation was valid in the Mayo Foundation for Medical Research and Education and the University of Minnesota cases. These institutions petitioned the Supreme Court for certiorari. Yesterday, the United States Supreme Court granted the certiorari petition and will hear the appeal.
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On March 18, 2010, the Illinois Supreme Court denied property tax exemption to a not-for-profit hospital in the nationally watched Provena case. The plurality's reasoning has implications for many nonprofits beyond hospitals.
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U.S. taxpayers, including not-for-profit/exempt organizations, with a financial interest in or signatory authority over a foreign financial account are generally required to file the Report of Foreign Bank and Financial Accounts, Form TD F 90-22.1 (FBAR) with the Department of the Treasury each June 30 if the aggregate value of all of the U.S. person's foreign financial accounts exceeds $10,000 at any time during the year. Taxpayers must also report whether they have such interests on their tax returns (for example, Forms 1040, 1041, 1065, 1120, and 990).
Under new IRS guidance, persons who have only signatory authority over a foreign financial account for calendar year 2009 and previous years has been extended again to June 30, 2011. In addition, owners of foreign hedge funds and private equity funds do not have to file FBARs for calendar year 2009 and previous years. And, persons who are relieved of filing FBARs this year also do not have to report the interest on their own returns. Holders of foreign mutual funds, however, will need to file FBARs by June 30, 2010 for calendar year 2009 and previous years.
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The IRS has announced that it plans to honor certain medical resident FICA refund claims for periods before April 1, 2005, when new IRS regulations went into effect. The IRS's brief announcement does not indicate the terms on which claims will be paid. Still, the IRS notes that verification of the claim amount will be required and interest will be paid.
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Updates for Tax-Exempt Organizations from the Senate Bill
By David Miller, Amanda H. Nussbaum, Elizabeth M. Mills, Steven Einhorn and Amy Zelcer on Posted in IRS
Updates for Tax-Exempt Organizations from the Senate Markup to the Tax Cuts and Jobs Act
By Amanda H. Nussbaum, Elizabeth M. Mills, Steven Einhorn and Amy Zelcer on Posted in Uncategorized
New Rules for Tax-Exempt Organizations in the Tax Cuts and Jobs Act
By Steven Einhorn, David Miller, Elizabeth M. Mills and Kathleen R Semanski on Posted in Charitable Giving, Private Foundations, Religious Organizations
New Electronic Form 8976 to Alert IRS About Section 501(c)(4) Status; 1023-EZ Application Reduced to $275
By Elizabeth M. Mills and Zachary Zermay on Posted in IRS, IRS Filings, Political Campaign Activity
IRS To EOs: We Can’t Help
By Elizabeth M. Mills on Posted in IRS Filings
New Flexibility for Joint Ventures Using Tax-Exempt Bond-Financed Property
By Elizabeth M. Mills on Posted in Uncategorized
IRS Encourages Private Foundations to Consider Charitable Purposes in Investing Its Assets
By Elizabeth M. Mills on Posted in Private Foundations
IRS Commissioner Says IRS is “Under New Management;” What’s Happened Over the Past Year In the IRS Affecting Tax-Exempt Organizations?
By Elizabeth M. Mills on Posted in IRS Filings
Senate Finance Committee Staff Compiles Past Proposals for Exempt Organization Tax Reform
By Elizabeth M. Mills on Posted in Charitable Giving
In Annual Procedure Update (Usually a Yawner), IRS Imposes 27-Month Deadline For Filing Exemption Applications For All Types of Exempt Organizations Seeking Retroactive Recognition of Exemption And Denies Retroactive Recognition of Exemption if Forms 990 Not Filed
By Elizabeth M. Mills on Posted in Formation, IRS Filings
The American Taxpayer Relief Act of 2012: Stealth Impact on Charities
By Elizabeth M. Mills on Posted in Charitable Giving
IRS Finally Confirms that Contributions to Single Member LLCs Owned by Charities Are Deductible
By Jacob I. Friedman and Elizabeth M. Mills on Posted in Charitable Giving, IRS Filings
Proposed Regulations on Federal Income Tax Exemption for Hospitals
By Elizabeth M. Mills on Posted in Healthcare Organizations, IRS Filings
New Proposed Regulations on Federal Income Tax Exemption for Hospitals
By Elizabeth M. Mills on Posted in IRS Filings
Stealth Can Be Good: New Procedure Allows Governmental Entities to Relinquish Section 501(c)(3) Tax-exempt Status
By Elizabeth M. Mills on Posted in IRS Filings
Treasury Releases Long-Overdue Report on Supporting Organizations and Donor Advised Funds
By Elizabeth M. Mills on Posted in Charitable Giving
IRS Releases 2010 Schedule H and Grants Automatic Three-month Extension of Time to File
By Elizabeth M. Mills on Posted in Healthcare Organizations
Medical residents conclusively determined to be subject to FICA tax beginning April 15, 2005 under new U.S. Supreme Court decision
By Elizabeth M. Mills on Posted in Healthcare Organizations
IRS-Treasury Annual Priority Guidance Plan Released
By Elizabeth M. Mills on Posted in IRS Filings
Medical Resident FICA — Action on Individual Refund Claims
By Elizabeth M. Mills on Posted in Healthcare Organizations
United States Supreme Court will Hear Medical Resident FICA Case
By Elizabeth M. Mills on Posted in Healthcare Organizations
Illinois Supreme Court Denies Property Tax Exemption to Not-for-Profit Hospital
By Elizabeth M. Mills on Posted in Healthcare Organizations
Some Not-for-Profit/Exempt Organizations May Have FBAR Filing Obligations
By Elizabeth M. Mills on Posted in IRS Filings
IRS to Honor Certain Medical Resident FICA Refund Claims
By Elizabeth M. Mills on Posted in Healthcare Organizations