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Nonprofit Tax Rules Leave Open Long-Standing Reporting Question

April 24, 2020, 4:25 PM

Nonprofits are hoping for clarity from the IRS on how to divide time and pay for employees and resources that fit into multiple areas under rules for calculating income derived from side activities.

Nonprofits have been grappling with that issue since the 2017 tax law required them to separately report each stream of their unrelated business income. But IRS proposed rules (REG-106864-18) released Thursday don’t give the level of detail the sector was seeking. Instead, the agency signaled it would address the questions in future guidance, leaving some confusion in its wake.

“I was thinking that that guidance ...