A curious revenue raiser in the Tax Cuts and Jobs Act was a complicated new tax on the free parking or transit passes provided by a nonprofit organization to its employees. Essentially, the organization was subject to the unrelated business income tax (UBIT) on expenditures for transportation benefits provided to employees.
The Disaster Act portion of H.R. 1865 completely repeals this tax, retroactive to the beginning of 2018. Nonprofits that paid the tax in 2018 and 2019 will want to seek a refund. Expect the IRS to issue guidance on how to pursue a refund.
The tax provisions wrapped into Public Law 116-94 will help Americans dealing with disaster situations and those who want to help in the wake of a disaster. Consult your Frazier & Deeter tax advisor if you have questions about how these changes could impact your unique tax situation.