Exempt organizations impacted by crisis may benefit from recent legislation, guidance

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April 2020

Overview

As individuals and businesses continue to be impacted by the economic effects of the COVID-19 pandemic, Congress, the IRS, and other government agencies are providing relief through legislation, administrative guidance, and programs. Tax-exempt organizations, including hospitals, universities, museums, and others, are no less impacted. This Insight outlines legislative and regulatory provisions with particular impact to tax-exempt organizations.

The takeaway

As a result of the COVID-19 pandemic, many tax-exempt organizations have been forced to shutter operations and cease revenue-producing activities. At the same time, tax-exempt organizations, such as those operating in the healthcare provider sector, are being asked to do even more. While many tax provisions in the CARES Act are focused on taxable businesses, a number of the provisions, especially those relating to payroll taxes, apply to tax-exempt organizations. Other loan provisions relating to employer-provider assistance to employees may apply to tax-exempt organizations. Evaluating the various programs’ applicability and potential benefits and taking quick action may serve to help cash flow.

Organizations should continue to monitor for future government guidance on how these programs will be administered and for possible future tax filing and payment relief.

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Rob Friz

Health Services Tax Leader, PwC US

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