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IRS Softens Blow After Tax Law Cut Perks for Nonprofit Employees (2)

Dec. 10, 2018, 8:14 PMUpdated: Dec. 10, 2018, 11:35 PM

The Internal Revenue Service moved to soften the hit from a controversial provision in last year’s tax overhaul that imposes a tax on some coveted benefits for employees at nonprofits.

The law sets a 21 percent tax rate for nonprofits on so-called fringe benefits—such as free parking and fare for mass transit—they provide to employees. Previously, nonprofits didn’t have to pay tax on the perks. Religious groups have pressured top Republican leaders, including House Ways and Means Committee Chairman Kevin Brady, to repeal the tax this year.

Nonprofits, such as churches and colleges, would be given some leeway when calculating ...