Congress repealed the part of the 2017 Tax Cuts and Jobs Act that required nonprofits, including churches, ministries, schools, and other tax-exempt organizations, to pay a 21 percent unrelated business income tax (UBIT) on parking benefits provided to their employees. The repeal was signed into law on December 20, 2019. Congress had previously enacted this provision for amounts paid or incurred after December 31, 2017.

Read more background on the parking tax and ECFA’s repeal efforts.

Now the IRS has provided guidance on claiming a refund or credit of the UBIT reported on your Form 990-T for 2017 or 2018 related to the parking tax benefit provided to employees. You may do so by filing an amended Form 990-T and write “Amended Return – Section 512(a)(7) Repeal” at the top of the Form 990-T.                                                                                                                                                                                                                                                            
Keep in mind that the time limits for filing refund claims found in IRC Section 6511 apply to these refund claims. Typically, these time limits are three years from the time the original Form 990-T was filed or two years from the time the tax was paid, whichever is later.

For additional instructions on preparing the amended Form 990-T, see the full IRS webpage – How To Claim a Refund or Credit of Unrelated Business Income Tax (UBIT) or adjust Form 990-T for Qualified Transportation Fringe Amounts.