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Taxes Paid by Tax-Exempt Organizations: Impact of Wayfair, 4960 Excise Tax, Property and UBIT

Note: CLE credit is not offered on this program

Recording of a 110-minute CPE webinar with Q&A

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Conducted on Wednesday, September 18, 2019

Recorded event now available

This course will update tax practitioners and advisers working with tax-exempt entities on the numerous taxes nonprofit organizations may owe. The webinar will cover Wayfair's effect on sales tax liability, the unexpected reach of the new excise tax on compensation, property tax liability, and unrelated business income tax (UBIT).

Description

Although practitioners know better, the general public incorrectly assumes that tax-exempt organizations pay no taxes. Online fundraising has opened up potential multistate sales tax liability for nonprofit organizations. Wayfair and economic nexus have altered the landscape of sales taxes in almost every state, and for all businesses, including organizations exempt from income tax. Forty-five states and D.C. have sales tax and most now tax out-of-state sales. It is no longer enough to know only your own state's sales tax requirements.

But, is any organization truly exempt from tax? Avoiding or minimizing UBIT seems to be the name of the game for nonprofit organizations who prefer to report no or minimal UBIT and therefore receive no or minimal tax benefit from their tax-exempt status. Tax-exempt organizations may be subject to property tax on property if it is not used for a tax-exempt purpose. Without proper policies in place, nonprofits can be liable for taxes on properties based on rapidly evolving principles being re-imagined by tax assessors and judges.

Tax reform brought with it the new Section 4960 excise tax. Initially, with a $1 million compensation threshold, many nonprofits ignored the new provision. Now on closer look, the inclusion of deferred compensation and complex record-keeping requirements make this excise tax a matter of concern to almost all nonprofit organizations.

Listen as our panel of experts helps you guide nonprofit organizations in making the right decisions to maximize the advantages of tax-exempt status. Our experts will explain state tax issues, including property and sales tax after Wayfair, as well as federal UBIT and Section 4960 excise tax considerations after the latest tax act and other taxation issues facing nonprofit organizations.

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Outline

  1. Wayfair's implications for nonprofits
  2. New Section 4960 excise taxes
  3. Other excise taxes
  4. Avoiding and minimizing UBIT
  5. Property taxes
  6. Other NPO tax considerations

Benefits

The panel will review these and other vital issues:

  • How Wayfair impacts nonprofit sales and purchases
  • Is my nonprofit liable for Section 4960 excise tax?
  • Calculating UBIT after tax reform
  • Best practices by nonprofits to minimize potential tax liability
  • Other potential tax obligations that should be considered by all nonprofits

Faculty

Carter, Tiffany
Tiffany Gourley Carter
Policy Counsel
National Council of Nonprofits

Ms. Carter joined the Council of Nonprofits' Team as State Policy Counsel in 2016. She moved to DC from Honolulu,...  |  Read More

Morgan, Daniel
Daniel L. Morgan
Partner
Blank Rome

Mr. Morgan has spent his career representing a wide range of public and private companies and nonprofit organizations,...  |  Read More

Thompson, David L.
David L. Thompson
Vice President of Public Policy
National Council of Nonprofits

Mr. Thompson is Vice President of Public Policy for the National Council of Nonprofits, the nation’s largest...  |  Read More