What Tax Reform Means for Tax Exempt Organizations

You can do something about tax reform. It is not too late to speak up and be heard about the adverse effects the new tax act has on tax exempt organizations. Unsure of what the impact is or what to say to your congressional representative or the IRS? Nationally acclaimed expert on tax exempt organizations law, Eve Borenstein, has written a must-read comprehensive article, “What the Exempt Organizations Community Must Know About the New Tax Law.” Read More>

In this article, Eve calls to action people who care about tax exempt organizations.  What can you do?

  • Call your local legislators. Tell them your opinion on the TCJ Act. Eve’s article provides specific code sections which most unfairly target exempt organizations.
  • Write to the IRS. We need more guidance. Encourage them to issue guidance to help organizations properly and fairly implement the new law. Without such guidance the sector will be unable to apply the new law equitably across organizations. For example, two organizations with identical unrelated businesses can reasonably apply the new segregation rules differently resulting in different taxable incomes because we do not have guidance from the IRS on the definition of what is a separate trade or business or which trades or businesses may be combined.
  • Where the IRS has not had time to issue Regulations and guidance, request the IRS extend implementation of the tax law. There is precedent for this. Most recently, when the Affordable Care Act was passed, the IRS extended the implementation date because it needed additional time to implement the individual and employer mandate.

It is surprising how little public outcry there has been from the tax-exempt sector and their supporters in the wake of this legislation. There is still time to communicate with the IRS and encourage them to take the additional time needed to issue guidance.

As many of you may know, we have worked with Eve Borenstein on several projects and consider her a valued partner. If you still have follow up questions or need assistance figuring out how the new TCJ Act will impact your organization, we will be reaching out to our existing clients. Alternatively, please call or email your Clark Nuber tax team to set up an appointment.  We are happy to help you and your board navigate the new law.

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