An Obscure Tax Could Cost Jewish Nonprofits Millions

A little-noticed provision of the new tax law is for the first time imposing a levy on all not-for-profits, including synagogues and Jewish day schools. The authors of the measure apparently did not realize the implications of their action which is said to have been aimed at large universities and hospitals and are now scrambling to repeal the provision that is estimated to reap $1.7 billion over 10 years. The measure was included in the Federal Tax Cuts and Jobs Act of 2017, which stated that there is to be a tax of 21 percent tax on the amount paid or incurred by any nonprofit employer for commuter benefits, such as transit or parking. The only exception is for organizations that provide benefits that are valued at less than $1,000 annually. An organization such as B’nai B’rith International, for instance, said it is not impacted because it does not offer fringe benefits in the form of parking and transit.