Rep. Ben McAdams (D-UT) this week urged his fellow members of the powerful House Ways and Means Committee to repeal the unrelated business income tax on certain employee benefits provided by associations and other types of nonprofit groups.
The tax is on benefits such as parking and transportation, and is proving to be a huge burden for the nonprofit community, including churches and small charities that have little or no experience dealing with the IRS and insufficient guidance on how to calculate the value of parking and other benefits provided to their employees. ASAE and its UBIT Coalition have been pushing Congress to repeal the tax for more than a year.
During a members’ day hearing this week, Ways and Means lawmakers made pitches for various issues under the committee’s jurisdiction. To date, Ways and Means Democrats have not prioritized a tax corrections bill to fix problems resulting from the GOP-led 2017 tax law but McAdams on Tuesday urged the committee to repeal the tax on nonprofit parking and transportation benefits this year.
“I have heard from a number of nonprofits and religious organizations in Utah who have been affected by this new tax, and they tell me they are diverting resources away from their main missions to account for the new tax,” McAdams said.
McAdams is a co-sponsor of H.R. 1545, legislation to repeal the tax introduced earlier this year by Reps. Mark Walker (R-NC) and Tom Suozzi (D-NY). The bill is a companion to legislation introduced in the Senate by Sens. James Lankford (R-OK) and Chris Coons (D-DE).