NAICU Washington Update

IRS Announces Guidance on Claiming Parking Tax Refunds

January 30, 2020

The Internal Revenue Service (IRS) has published guidance for nonprofit employers who have paid Unrelated Business Income Tax, or UBIT taxes, on employee parking and other mass transit benefits for tax years 2018 and 2019.  The so-called “Parking Tax” was repealed in year-end tax and budget legislation that was signed into law in December.  Not only was the Parking Tax repealed, it was done so retroactively, so nonprofits that paid any amount since it was enacted, are entitled to a refund.
According to the guidance, the refunds will be processed after the taxpayer submits an amended Form 990-T for each year the tax was paid. In addition, claims for reimbursement should be filed no later than three years after the original Form 990-T was filed, or two years after the tax was paid.  These time limits follow current IRS guidelines for filing refund claims.

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