Tax Resources

Tax Resources

Tax Reform Legislation

On Friday, December 22, 2017 President Donald Trump signed tax reform legislation into law. Please note, the tax reform legislation does not impact the housing allowance exclusion for clergy. 

We will continue to review the tax legislation and its potential impact on the benefits that we offer to our clients and provide relevant updates. If you have specific tax-related questions, we encourage you to contact your personal tax advisor or call our tax hotline at the numbers listed below.

  • Nancy N. Fritschner, CPA (877) 305-1414
  • The Rev. Canon William F. Geisler, CPA (ret.) (877) 305-1415

Visit the Tax Resources page in your section of the website for more forms and resources.

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Transportation Fringe Benefits Now Subject To Federal Unrelated Business Income Tax

Beginning in 2018, a tax-exempt organization’s unrelated business taxable income (“UBTI”) will be increased by the amount the organization pays or incurs for qualified transportation fringe benefits, whether they are paid as an employer-funded benefit or through employee pre-tax salary deductions. As such, providing this benefit to your employees will result in an unrelated business income tax liability and tax filing obligation on a Form 990-T. In addition, this tax expenses should be considered for future budgeting purposes.

Although some employers may wish to stop offering this benefit as a result of this change in the law, please consult with your legal counsel as some cities mandate that certain employers offer to their employees a commuter benefits program (such as New York City’s Affordable Transit Act and similar laws in Washington D.C. and the Bay Area in California).

Furthermore, under the Tax Cuts and Jobs Act, each unrelated business activity must be separately reported on Form 990-T. As such, the unrelated business activity losses of one activity may not be used to offset the unrelated business income of another activity. Therefore, the unrelated business income arising from providing transportation fringe benefits to employees cannot be offset by any other unrelated trade or business activities that may produce losses.

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2018 Federal Reporting Guide

The 2018 Federal Reporting Requirements for Episcopal Churches (for administrators) is available.

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2018 Tax Guide for Episcopal Ministers (Clergy Tax Guide) 

The 2018 Tax Guide for Episcopal Ministers (for 2017 Tax Returns) is now available.

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Clergy Housing Ruling

On Friday, October 6, 2017, Judge Barbara Crabb of the Federal District Court of the Western District of Wisconsin ruled that the exclusion from taxation of a minister’s cash housing allowance is unconstitutional. The exclusion allows a minister to exclude from taxable income a cash housing allowance designated and paid by his or her church.

The Church Alliance, a coalition of the chief executive officers of 38 church benefit programs that CPG works with on legislative and regulatory matters, prepared a summary of the ruling that you can view here. We believe that this decision almost certainly will be appealed, and we will continue to monitor the case and keep you abreast of future updates.