Not For Profit/Exempt Organizations Blog

Tag Archives: IRS

Parsonage Exclusion Found by Seventh Circuit to Be Constitutional

On March 15, 2019, the U.S. Court of Appeals for the Seventh Circuit held in Gaylor v. Mnuchin that the tax exemption for “ministers of the gospel” (defined below) under Section 107(2) of the Internal Revenue Code (the “Code”) does not violate the Establishment Clause[1] of the First Amendment and, therefore, is constitutional, overruling the … Continue Reading

Inclusion of Qualified Transportation Fringe Benefits in UBTI: Guidance, Relief, and Rumors of Possible Repeal

December 10, 2018 saw significant activity with respect to Section 512(a)(7) of the Internal Revenue Code (the “Code”), which requires tax-exempt employers to increase their unrelated business taxable income (“UBTI”) by amounts paid or incurred for qualified transportation fringe benefits provided to employees, including the provision of parking and public transportation benefits. Section 512(a)(7) was … Continue Reading

IRS Announces Relief from the “Once-In-Always-In” Requirement for Excluding Part-Time Employees Under 403(b) Plans

Last week, the IRS released Notice 2018-95 to provide transition relief to 403(b) plans that improperly excluded certain employees.  Specifically, Notice 2018-95 targets employers that may have erroneously excluded part-time employees from eligibility to make elective deferral when the employees should have been eligible to participate under the “once-in-always-in” requirement (“OIAI”).  According to the OIAI … Continue Reading

Tax-Exempts May Limit Fund Investments Pursuant to New IRS Guidance on UBTI

On August 21, 2018, the Internal Revenue Service (“IRS”) released Notice 2018-67 (the “Notice”), addressing issues relevant to tax-exempt organizations arising under new Section 512(a)(6) of the Internal Revenue Code (the “Code”), promulgated pursuant to the 2017 U.S. tax legislation that is commonly referred to as the “Tax Cuts and Jobs Act.”  Section 512(a)(6) requires … Continue Reading

Update on the Department of Labor’s New Fiduciary Rules and Subsequent Challenges

On April 6, 2016, the Department of Labor under the Obama administration issued a new final rule and exemptions addressing when a person providing investment advice with respect to an employee benefit plan or individual retirement account is considered to be a “fiduciary” under the Employee Retirement Income Security Act of 1974 (“ERISA”) and the … Continue Reading

IRS Commissioner Says IRS is “Under New Management;” What’s Happened Over the Past Year In the IRS Affecting Tax-Exempt Organizations?

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

IRS Rules on Domesticated Organization and Tax-Exempt Status

Late last year, the Internal Revenue Service (“IRS”) issued a letter ruling, PLR 201446025, providing that, in certain instances, a nonprofit corporation exempt under Section 501(c)(3) of the Internal Revenue Code of 1986, as amended, and incorporated in State A was not required to file a new application for tax-exempt status (IRS Form 1023) when … Continue Reading

IRS Issues Wake Up Call to Colleges and Universities — Congress to Hold Hearings

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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