Exempt Organization Tax

New Excise Tax on Excess Compensation for Nonprofit Executives Courtesy of the 2017 Tax Act

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By R. Michael Sorrells, CPA
The recently passed tax reform package added new Internal Revenue Code Section 4960 to the tax laws. This code section imposes an excise tax on organizations who pay certain executives compensation in excess of $1 million dollars annually.  The tax (which is paid by the organization, not the individual) is at […]

Corporate AMT Repeal and Net Operating Losses: The Expected and the Unexpected Consequences of Tax Reform

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By Deborah G. Kosnett, CPA
You may or may not have heard that tax reform has done away with the corporate alternative minimum tax (AMT), and also has made significant changes to the deductibility of net operating losses (NOLs). Additionally, exempt organizations with unrelated business income (UBI) will have to deal with new net loss restrictions: […]

The New Tax Bill – What Nonprofits Should Know Right Now

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By: Lisa Heller, Tax Senior Manager
At this writing, the Tax Cuts and Jobs Act is all but signed into law. With this new tax bill comes sweeping changes that potentially impact all U.S. taxpayers, including exempt organizations. For the most part, these changes will be effective for tax years beginning after 2017.
The full text of […]

Membership Dues Under Attack? A New Tax Reform Twist

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Dear Clients and Friends,
The American Society of Association Executives (ASAE) has identified a provision in the tax reform legislation that may serve to eliminate the deductibility of association/society dues as a business expense. Naturally, this could have a dramatic impact on the affordability of membership dues.
Jim Clarke, ASAE’s Senior Vice President of Public Policy, has […]

Coming Soon? A New 5 Year Reapplication Requirement for DC Tax Exemptions

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Coming Soon? A New 5 Year Reapplication Requirement for DC Tax Exemptions
By: Eric Owens, Tax Senior
Exempt organizations with offices in the District of Columbia, take note! You soon will need to reapply for exemption every 5 years, according to the DC Office of Tax and Revenue (OTR). This reapplication process is slated to apply not […]

Tax-Exempt Organizations and 2017 Tax Reform

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Dear Friends in the Tax-Exempt Community:
Below is a brief overview of the key tax reform proposals relating to tax-exempt organizations. As you know, Congress is currently putting together legislation to effect significant tax reform with a timeline of having it enacted this year. Although Congress is still negotiating, the following reform proposals may impact your […]

Royalty Income of Nonprofits is Being Targeted for Taxation!

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The Senate Finance Committee’s version of the Tax Cuts and Jobs Act includes a number of items that would impact nonprofits.
Perhaps the most immediately significant is the provision that would call for taxing the revenue generated from royalties related to licensing a nonprofit’s name and/or logo. Royalty revenue has traditionally been exempt from income taxes. […]

How Could Federal Tax Reform Impact Nonprofits?

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By:  Doug Boedeker, CPA, Partner
It has been a challenge staying current on the twists and turns involved with the proposals for Federal Tax Reform. Many of the ideas within the tax reform package have a direct impact on nonprofit organizations.
Charitable deductions, executive compensation, employee fringe benefits, and intermediate sanctions are just some of the “hot […]

Less is More When it Comes to Judge Moore

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Honesty and accuracy go a long way, especially when you are dealing with the IRS.
Recently, a tax-exempt charity known as the Foundation for Moral Law was audited by the IRS.  According to the Washington Post, the IRS audit found discrepancies between the organization’s Form 990 filings and its internal books.  In a […]

Upcoming IRS Partnership Audit Changes Could Affect your Organization

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By: Deborah G. Kosnett, CPA
A major change in how the Internal Revenue Service audits partnerships is quickly approaching. Effective January 1, 2018, all IRS partnership audits will take place at the partnership level, as a result of a centralized partnership audit regime mandated by the Bipartisan Budget Act of 2015. Any tax liability resulting from […]

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