BUSINESS ARTICLES
IRS offers new direction on qualified transportation fringe benefit expenses for nonprofits
q
The IRS recently provided guidance on qualified transportation fringe (QTF) benefit expenses. If your nonprofit or organization provides transit passes or parking benefits to your employees, these benefits will now be taxed as income.
The IRS notes that they include transit passes, payments to a third party for employee parking, and expenses associated with a leased or owned indoor or outdoor garage or parking lot. The expenses associated with a leased or owned indoor or outdoor garage or parking lot include, but are not limited to, repairs, maintenance, utility costs, insurance, property taxes, interest, snow and ice removal, leaf removal, trash removal, cleaning, landscape costs, parking lot attendant expenses, security and rent or lease payments.
There are two exceptions to QTFs being taxed as income. The first exception is for the amount of QTF that is included in an employee’s compensation. The second exception is for the expenses associated with a leased or owned indoor or outdoor garage or parking lot that are made available for the general public.
To learn more about this new IRS guideline, please contact a Dugan & Lopatka professional at (630) 665-4440 or info@duganlopatka.com.