A new law was signed recently that repeals code Section 512(a)(7), the unpopular tax on most tax-exempt organizations, including religious organizations and voluntary health and welfare groups, for parking and various other transportation fringe benefits provided to employees. The provision is repealed retroactively, which means refunds can be requested for all taxes paid for the January 1, 2018 period onward. This is welcome relief for the nonprofit community!
The Internal Revenue Service (IRS) has released instructions detailing how to claim a refund or credit. Nonprofits that issue accrual basis financial statements can record a receivable for anticipated refunds.