UBIT

IRS clarifies royalty exception to UBIT

IRS Clarifies Royalty Exception to UBIT

Provisions in the Tax Cuts and Jobs Act have brought renewed attention to nonprofits’ potential liability for unrelated business income tax (UBIT). Organizations generally are subject to a 21% tax on unrelated income, but exceptions apply — including one for royalties. Although a “royalty” isn’t defined in the U.S tax code or regulations, a recent…

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transportation benefits

IRS Offers Nonprofits New Transportation Benefits Guidance

The Tax Cuts and Jobs Act (TCJA) dealt several blows to the nonprofit sector. One of them is that, effective January 1, 2018, nonprofit employers are subject to tax on transportation fringe benefits provided to employees. The IRS recently released Notices 2018-99 and 2018-100 to provide guidance on this issue. This guidance may clarify matters…

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