Latest guidance from the IRS makes it clear that tax-exempt employers should now pay income tax based on amounts included in employee compensation reduction agreements (CRAs).
As you know, certain provisions of the recent federal income tax reform legislation may have a significant impact on tax-exempt organizations. Currently, one of the most controversial of these provisions is the tax treatment of employer-paid expenses for transportation and parking benefits. The tax community’s interpretation of this provision has been evolving, and in fact, IRS has just announced guidance on this issue.
In this article, Tate & Tryon’s exempt organization tax specialists provide guidance regarding commonly asked questions about this provision and outline recommended steps that nonprofits should start taking now.