Report: Tax Reform Forcing Previously Tax-Exempt to Pay More

Report: Tax Reform Forcing Previously Tax-Exempt to Pay More

Churches, nonprofits, and other historically tax-exempt organizations are fuming at a stiff tax hit that comes with the Trump administration’s 2017 tax reform, The Washington Times  reported.

For the first time, houses of worship, universities, and nonprofits are looking at paying federal taxes on some employee benefits.

“I’d say the churches have every right to be outraged,” David Thompson, vice president of public policy for the National Council of Nonprofits, told the news outlet. “It’s an oxymoron. It’s horrendously unfair.”

“Think of it: $13 billion every decade on the backs of churches and nonprofits, hindering their ability to serve their constituents,” added Dan Busby, president of the Evangelical Council for Financial Accountability.

The provision got little notice after President Donald Trump signed the tax cuts into law last December with corporate and individual tax cuts commanding a majority of the attention, the news outlet noted.

But it has begun to sink in: Churches, synagogues, universities, and nonprofit groups now will have to pay taxes on employee fringe benefits such as parking and transportation — and a certain provision calls for a 21 percent tax on some fringe benefits and expenses, The Washington Times reported.

The change means some nonprofit groups must decide among trying to pay more in taxes, cutting employees’ benefits, or making other sacrifices, the news outlet noted.

“Four-hundred thousand houses of worship plus tens of thousands of nonprofit organizations are now paying attention,” Busby told The Washington Times. “This issue will not go away until it is repealed.”

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