Congress made a mistake on this tax measure – and admitted it
“Some eliminated parking and transit pass benefits. Others had to add tens of thousands of dollars to their annual budgets,” said Jan Masaoka, chief executive officer of the California Association of Nonprofits.
Religious institutions and nonprofits usually pay no income tax since they have no taxable income. And what made little sense to many was that the income tax was on an expense.
“For some churches, synagogues, and mosques, this tax filing may have been their very first communication with the IRS,” David Thompson, vice president of public policy at the National Council of Nonprofits, told a congressional hearing last year. He called the tax a ‘raw nerve.’”
Nonprofits were stung particularly hard, because religious institutions could get a break if a majority of their parking spaces were for public use, a common practice. But nonprofits usually don’t fit that requirement.
