Nonprofit Resources

Taxability of Transportation and Parking Fringe Benefits

Under section 512(a)(7) of the new tax law, nonprofit organizations that provide certain fringe benefits to employees, including qualified transportation and parking benefits, must now include the value of these benefits in unrelated business income tax (UBIT) and report it on Form 990-T.

However, the value of these benefits is not taxable to employees and the payments may be excluded from their wages. IRS Publication 15-B, “Employer’s Tax Guide to Fringe Benefits,” has further guidance on this issue.

 

 

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