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Updated June 6, 2019

Enacted as part of the Tax Cuts and Jobs Act, section 512(a)(7) introduced a new tax on amounts employers pay for parking and transit benefits.  Several bills have been introduced to repeal the measure:

  • S. 1282: The Preserve Charities and Houses of Worship Act. Introduced by Sens. Ted Cruz (R-TX) and Jeanne Shaheen (D-NH) and proposes repealing both the TCJA UBIT Tax on employer provided parking and transportation benefits and the TCJA requirement that organizations with more than one source of UBIT income compute their tax liability separately for each trade or business.

  • H.R. 1223/S. 501: Stop the Tax Hike on Charities and Places of Worship Act. Introduced by Majority Whip James Clyburn (D-SC) in the House of Representatives and by Senator Sherrod Brown (D-OH) in the Senate and proposes repealing the TCJA UBIT Tax on employer provided parking and transportation benefits. The House bill proposes to offset the cost of eliminating the tax by raising the corporate tax rate by 0.03%, the Senate version proposes to offset the cost of eliminating the tax by raising the corporate tax rate by 1%.

  • H.R. 1545/S. 632: The Lessening Impediments from Taxes for Charities (LIFT) Act. Introduced by Congressman Mark Walker (R-NC) in the House of Representatives and Sens. James Lankford (R-OK) and Chris Coons (D-DE) in the Senate and proposes repealing the TCJA UBIT Tax on employer provided parking and transportation benefits. This legislation was also introduced in the 115th Congress.

  • H.R. 513: Nonprofits Support Act. Introduced by Congressman Mike Conaway (R-TX) and proposes repealing both the TCJA UBIT Tax on employer provided parking and transportation benefits and the TCJA requirement that organizations with more than one source of UBIT income compute their tax liability separately for each trade or business.

Advocacy and Outlook.  NACUBO, along with a coalition of nonprofit groups, is reaching out to staff in key congressional offices and tax-writing committees, to explain the impact of the tax on colleges and universities and pushing for repeal of the so-called parking tax. 

In the coming months, Congress will be under pressure to address the federal budget deadline and the debt limit. It is possible that with growing support for repeal of the parking tax, a provision could be included with future "must pass" legislation that develops in the fall.

Take Action.  We urge business officers to continue to work with your institution’s governmental relations team to weigh in with your elected officials on this issue. You can find a one-pager on the issue here.

Contact

Liz Clark

Vice President, Policy and Research

202.861.2553


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