Relief Provided to Tax-Exempt Organizations from UBTI Related to Qualified Transportation Fringe Benefits
On December 19, 2019, the Senate passed the Further Consolidated Appropriations Act, 2020 (Act), which is expected to be signed today by President Trump. The Act includes welcome relief to tax-exempt taxpayers.
As part of this legislation, Section 512(a) was amended, repealing the requirement to increase unrelated business taxable income (UBTI) for qualified transportation fringe benefits. These transportation fringe benefits included the cost of employer-provided parking and employer-provided transit passes.
The repeal is effective retroactively to amounts paid or incurred after December 31, 2017, creating the potential opportunity to amend tax returns that included qualified transportation fringe benefits as UBTI. For more information, reach out to your BKD trusted advisor or use the Contact Us form below.