Wednesday, August 14, 2019
We all know how hard it can be for the federal government to enact new laws. It appears to be equally hard to repeal existing law, even when no one now thinks it is a good idea. The current example in the exempt organizations world is Internal Revenue Code section 512(a)(7), a/k/a the parking tax. By my count (and the JCT's) six bills have been introduced in the current Congress that specifically target this provision for repeal, three in each chamber, with sponsors ranging across the political spectrum from Representative James Clyburn to Senator Ted Cruz. (H.R. 513, H.R. 1223, H.R. 1545, S. 501, S. 632, and S. 1282). All six bills are currently in the respective tax writing committees. These bills are in addition to activity in the last Congress, which included to five bills plus a manager's amendment that would have also repealed the provision and was part of a bill that passed the House but not the Senate. The Joint Committee on Taxation also issued a report specifically on this provision earlier this summer.
To be fair, I exaggerate when I say no one likes the parking tax. At least the Tax Foundation supports it for bringing parity between exempt organizations and for-profit businesses, although that reasoning ignores the disparate administrative burden created by many exempt organizations now having to newly file a additional tax form (Form 990-T) and adopt administrative procedures they did not have previously in order to comply with their obligations under the new tax.
Previous 2019 blog coverage of this topic includes: Ways and Means Channels Its Inner Emily Litella on Parking: Never Mind; Much Ado About Parking (House Committee hearing); Renewed Calls to Repeal "Nonprofit Parking Tax"; IRS Issues Guidance Aimed at Limiting Impact on Nonprofits' Parking Expenses; House Majority Whip Renews Push to Repeal Taxation of Qualified Fringes as UBIT.