CBN News reported today on an unnoticed item in the tax cut bill passed by Congress this year.
The article reports:
Churches and non-profit organizations are calling for the repeal of a provision in the GOP’s tax cuts law that would force ministries to file federal tax returns, and in some cases pay taxes.
Last winter, as lawmakers touted the tax savings in the Tax Cuts and Jobs Acts, no one mentioned this new federal tax on local churches. But for non-profits like Christian ministries, that little-known provision in the legislation has become a big cause for concern.
…Under the new tax plan, churches, hospitals, colleges and other historically tax-exempt groups must pay a 21 percent tax on some benefits they provide their employees, such as parking, transportation and other related benefits.
Dan Busby is president of the Evangelical Council for Financial Accountability. He says churches weren’t expecting to get hit with – of all things – an income tax bill, and this one could be a huge burden on groups that have historically enjoyed tax-exempt status.
“There are nearly 15 million employees that work in the United States for nonprofits – nearly 10 percent of the workforce – so that’s 15 million parking places. And conservatively, it’s going to cost the non-profit community as a whole up to a billion dollars,” Busby said.
That’s a lot of money for ministries that rely on donations. In response to the news, the ECFA put out a petition that churches and nonprofits can sign to protest the employee parking tax.
“Tax practitioners who have evaluated Section 512(a) (7) generally believe that the result of this new provision is that tax‐exempt organizations that provide parking to their employees will be subject to unrelated business income tax on the cost of the parking provided. A nonprofit organization that simply allows its employees to park in a parking lot or garage that is part of the organization’s facilities will be subject to a tax on the cost of the parking provided,” the ECFA explained in a position statement available for download on its website.
This is the link to sign the petition against the new tax – https://www.ecfa.org/DocSig.aspx
Taxing churches on their staff parking places has to be one of the dumbest ideas I have ever encountered.