House Ways and Means Committee Chairman Kevin Brady (R-TX) released a revised year-end tax bill this week that still includes repeal of a 21 percent tax on parking and transportation benefits provided by nonprofit organizations.
ASAE and its UBIT Coalition have been seeking repeal or delay of this tax for almost a year. In addition to repealing the fringe-benefits tax on nonprofits, Brady’s tax bill would fix some other glitches in last year’s tax overhaul, revise some retirement-related sections of the tax code, extend a moratorium on the medical device tax by five years and repeal the Johnson Amendment that bars political activity by churches and other 501(c)(3) tax-exempt groups. Brady also stripped out tax extenders – extensions of temporary tax breaks – from the bill in the hopes of getting enough votes to pass the House.
While Congress is also trying to pass a farm bill and a government funding bill before the end of next week, Brady is hopeful about the tax bill’s chances in the House. However, the bill faces tough opposition in the Senate where it would need Democratic votes to pass. Signaling he might be willing to accept a slimmer version of the bill, Brady said the Senate “clearly can eliminate any provision that doesn’t have bipartisan support and send it back.”
Repealing the tax on nonprofit employee benefits does have broad support, but some other provisions in the Brady bill, such as repeal of the Johnson Amendment, would need to be discarded to get Democratic votes in the Senate. ASAE is encouraging organizations to support this repeal effort by sending this model letter to members of the House and Senate.