On January 19, 2021 the Department of the Treasury (“Treasury”) and the Internal Revenue Service (“IRS”) published in the Federal Register Final Regulations (the “Final Regulations”) interpreting the excise tax under Section 4960 of the Internal Revenue Code on certain executive compensation paid by tax-exempt organizations. The Final Regulations maintain most of the concepts from … Continue Reading
Proposed Regulations under Section 4960 of the Internal Revenue Code provide important guidance for tax-exempt organizations and their affiliates regarding an excise tax on certain executive compensation. The U.S. Department of the Treasury (“Treasury”) and Internal Revenue Service (the “IRS”) are accepting comments until August 10, 2020. (Throughout this post, “Sections” refer to sections of … Continue Reading
As we have previously discussed, the 2017 tax reform act created a new excise tax under section 4960 of the Internal Revenue Code that will affect many tax-exempt employers. The tax is 21% of certain compensation and can be triggered if an employee receives more than $1 million of compensation or an employee receives certain … Continue Reading
On December 31, 2018, the Department of the Treasury (“Treasury”) and the Internal Revenue Service (the “IRS”) released Notice 2019-09 (the “Notice”), which provides interim guidance under Section 4960 of the Internal Revenue Code. Very generally, Section 4960 imposes a 21% excise tax on certain tax-exempt entities (and certain related organizations) that pay remuneration in … Continue Reading
A New York court has held that the State’s regulatory limits on executive compensation and administrative expenses for entities that receive state funds unconstitutionally exceed proper regulatory authority. The regulations, which implemented a 2012 executive order by Governor Andrew Cuomo and went into effect on July 1 of last year, were promulgated in substantially similar … Continue Reading
The IRS released its Final Report on its five year study of the audit results of colleges and universities. Lois G. Lerner, Director of the Exempt Organizations division of the IRS announced the “long awaited” posting of the report. In 2008, the IRS sent a 33 page questionnaire to 400 randomly selected colleges and universities. In 2010, … Continue Reading
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