Nonprofit Parking Tax Repealed: Impact on Tax Exempt Organizations

By Keiter CPAs

Nonprofit Parking Tax Repealed: Impact on Tax Exempt Organizations

Tax Exempt Organizations Expecting Refunds Due to the Nonprofit Parking Tax Repeal

On December 20, 2019, the Taxpayer Certainty and Disaster Tax Relief Act of 2019 (the “Act”), was signed into law, repealing a wildly unpopular provision of the 2017 Tax Cuts and Jobs Act (“TCJA”) which assessed unrelated business income tax on charitable organizations for parking benefits provided to their employees. Internal Revenue Code 512(a)(7) is repealed to the time of enactment, paving the way for charitable organizations to recover taxes paid previously. Guidance from the IRS is expected regarding the process to apply for refunds.

Other Impacts

In addition to repeal of 512(a)(7), the Act also simplified the calculation of net investment income excise tax assessed to private foundations. IRC Section 4940(a) set forth a two-tiered system for calculating the excise tax at 1% or 2%, which is now replaced by a flat 1.39%.

The Not-For-Profit Opportunity Advisors at Keiter will provide updates regarding the refund application process as guidance becomes available. Stay tuned!

Questions on how these changes may impact your not for profit organization? Contact your Keiter representative or Email | Call 804.747.0000. We are here to help.

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Keiter CPAs

Keiter CPAs

Keiter CPAs is a certified public accounting firm serving the audittax, accounting and consulting needs of businesses and their owners located in Richmond and across Virginia. We focus on serving emerging growth businesses and companies in the financial servicesconstructionreal estatemanufacturingretail & distribution industries and nonprofits. We also provide business valuations and forensic accounting servicesfamily office services, and inbound international services.

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The information contained within this article is provided for informational purposes only and is current as of the date published. Online readers are advised not to act upon this information without seeking the service of a professional accountant, as this article is not a substitute for obtaining accounting, tax, or financial advice from a professional accountant.


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