The taxation of Division I college sports may change once universities begin paying athletes directly, which will be permitted under a settlement of antitrust litigation against the NCAA and major collegiate athletic conferences. This article discusses some of the yet-to-be-resolved tax issues for schools and donors.
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Tax-Exempt Organizations
Complying with ACA tax-exempt hospital requirements
Hospital facilities must meet the requirements of Sec. 501(r) provisions of the Patient Protection and Affordable Care Act, P.L. 111-148 to retain tax-exempt status.
Tax-exempt investment in partnerships holding energy properties
If tax-exempt entities invest in energy projects through partnerships, careful consideration should be given to allocations under the respective partnership arrangements to avoid any detrimental impact on the eligibility of the energy property’s basis for ITC and accelerated depreciation
BOI update: 6.5 million of 32 million reports filed so far
FinCEN official says the reports “track more closely” with businesses created in 2024, which have a tighter deadline to file than businesses created earlier.
BOI reporting deadlines extended for certain victims of 5 hurricanes
The AICPA had requested that the Financial Crimes Enforcement Network extend reporting deadlines for beneficial ownership information for victims of hurricanes Beryl, Debby, Francine, Helene, and Milton.
Tardy to the e-filing party
Exempt organizations having to e-file all returns in the Form 990 series under the Taxpayer First Act’s requirements may encounter logistical issues.
Planning for private foundation grantmaking
Private foundations can plan their grantmaking for optimal impact while complying with Sec. 4942 rules on required distributions. Strategies can help foundations support large charitable projects, preserve the value of their assets, and enhance long-term grantmaking capacity.
The clean-energy direct-pay election for not-for-profits and governmental entities
Under the Sec. 6417 direct-pay election, tax-exempt organizations, including not-for-profits and governmental agencies, can claim certain energy credits on their federal income tax returns, but to claim them for 2023, the direct-pay election must be made on a timely filed 2023 federal income tax return.
Most NIL collectives do not further a Sec. 501(c)(3) exempt purpose
Most name, image, and likeness collectives will not be furthering a Sec. 501(c)(3) purpose.
IRS addresses whether college NIL collectives further an exempt purpose
A memo from the IRS Office of Chief Counsel advises that an organization that develops paid NIL opportunities for student-athletes will, in many cases, be operating for a substantial nonexempt purpose—serving the private interests of student-athletes—which is more than incidental to any exempt purpose furthered by the activity.
Supporting organization loses tax-exempt status
This item discusses the IRS’s revocation decision and its implications.
Private foundations’ distributions to and from nonpublic charities
Two recently published IRS letter rulings provide helpful informal guidance for private nonoperating foundations, particularly ones that receive and/or make grants from or to other private foundations.
Tax considerations on charitable giving of cryptoassets
This item discusses key tax considerations for donors and charitable organizations that wish to give or receive digital asset donations.
Scholarship grants awarded by private foundations
As long as certain rules are followed, scholarship grants can be nontaxable to both the exempt private foundations granting them and the recipients of the grants.
Sales tax considerations for exempt organizations
Exempt organizations often dedicate resources to complying with federal tax laws but may not recognize the complexity of state and local sales and use taxes.
Various exempt organization notices paused
Citing processing delays, the IRS suspends 10 late-filing notices to tax-exempt organizations.
Guidance issued for LLCs seeking tax-exempt recognition
The IRS clarified the standards that an LLC must satisfy to obtain a determination letter that it is exempt from taxation under Sec. 501(c)(3).
How much unrelated business activity is too much?
This item discusses the IRS position allowing the unrelated activities to be substantial so long as they are not the organization’s “primary purpose,” while also acknowledging the confusion and uncertainty on this point.
Sorting out tax exempts’ UBTI painlessly
To help exempt organizations “silo,” or separately compute, their unrelated business or trade income, three experts who will be giving a presentation on the topic at the upcoming Not-for-Profit Industry Conference offer their thoughts.
Excise tax on excess remuneration of covered employees of tax-exempt organizations
The IRS issued final regulations on the excise tax on excess remuneration over $1 million paid by tax-exempt organizations, finalizing proposed regulations with a few changes in response to comments.
TAX PRACTICE MANAGEMENT
2025 tax software survey
AICPA members in tax practice assess how their return preparation software performed during tax season and offer insights into their procedures.
