Update: Parking Expenses as Qualified Transportation Fringes

On December 20th, 2019 the Further Consolidated Appropriations Act, 2020 (the Act) was signed into law. The Act contains a repeal of what has been referred to as a “parking tax” on tax exempt organizations. This repeal eliminated the inclusion of qualified transportation fringe benefits as unrelated business income. As a result tax exempt organizations will no longer be required to calculate and report costs associated with employee parking as unrelated business income.The repeal is retroactive and the Internal Revenue Service is expected to provide additional guidance regarding how tax exempt organizations can obtain a refund relating to amounts previously paid.