Liz Moore, MNA Executive Director
Did you know the new federal tax bill repealed a deduction for charitable contributions paid to colleges or college athletic departments in exchange for event tickets or seating rights at a stadium? Neither did I! Fortunately, the National Council of Nonprofits (Council of Nonprofits) has developed a great checklist of boutique issues like this one – policy changes related to tax reform which might impact only a few of us but nonetheless matter. The Council of Nonprofits 2018 Tax Law Checklist covers several Human Resource changes employers will want to take note of, some changes employees might be interested in, confusing changes regarding unrelated business activity, and some issues related to fundraising, including the one noted above related to stadium tickets.
Unrelated Business Income
Even if you don’t engage in what you think of as “unrelated business activity”, you might want to notice a new provision that imposes a tax on employers for a particular type of employee expense related to transportation. If you have employees who receive a transportation benefit such as a monthly gas card or parking pass, you are now apparently subject to tax on that expense. AND, even if an employee voluntarily deducts money from their paycheck to be placed into a pre-tax qualified plan for commuting expenses, that money will now be taxed to the employer as well. Does this confuse you as much as it confuses me? The recent Council of Nonprofits Knowledge Matters newsletter overviews the issue. The Council of Nonprofits is actively engaged with the IRS on our behalf with this message: the new guidance is confusing and places a significant burden on tax exempt organizations. Please delay implementation until you know the real impact and provide clarity. What are your questions/concerns related to the new provision? Let us know.
With the National Day of Prayer just around the corner, we’re monitoring whether the potential repeal of the Johnson Amendment will re-emerge as an issue of concern. Last year’s Day of Prayer was a campaign launch of some sort, and while we’re not looking for trouble, we are paying attention.
A fair and full census count is directly related not only to our congressional seats, but also to the amount of federal funding Montana will receive over the course of the next decade. With this much at stake for communities and the nonprofits who serve them, MNA will be involved. We don’t have any action steps yet, but I want you to know this is on our radar and we’re ramping up our efforts.
Public Service Loan Forgiveness (PSFL) is another area we are watching. It’s important to nonprofits particularly as we look at recruiting and retaining talent into the sector. And especially important in a rural state like Montana where other benefits can be few and far between. Do you have a story related to how PSFL has been used by one of your staff members? Please get in touch. We are collecting anecdotes which can be used by a national coalition working on preservation of this important program. And by the way, if you’re not using PSFL in your recruitment efforts, it might be worth consideration.
At the state level, just a quick note that work has begun on the renewal of the Montana Endowment Tax Credit. We will send more information as we move closer to the 2019 Legislative Session. For now – if you have a great story of how the Tax Credit helped make something remarkable happen in your neck of the woods, please share it with us.
That’s it for now. The UBIT issue is more significant than it seems on the surface, so we’ll let you know how that progresses. In the meantime, happy “Spring has finally sprung”, and be well.