Financial Management |
Independent schools might breathe a small sigh of relief in reviewing the final compromise version of the sweeping tax overhaul legislation released December 15 by the House and Senate conference committee. The 1,097-page bill (with a 570-page joint explanatory statement alone) goes back to both chambers for votes this week. If approved, the bill will go the president to be signed into law, possibly before the Christmas break.
School Groups Outline 5 Key IssuesInterest on Tax-Exempt Debt and Loans Could IncreaseTax Overhaul's Impact on Independent Schools Still Uncertain
Tax Bills Extend 529-Type Plans to K-12
Schools Encouraged to Speak Out on Tax ProposalsGOP House and Senate Tax Plans Worry Independent Schools
GOP Tax Reform Jeopardizes Tax-Exempt Financing for Independent School
NBOA’s Jennifer Osland Hillen, director of accounting, finance and tax programs, and John Toscano, leader of the independent school industry practice at CohnReznick, a financial advisory firm, have reviewed the final language. “We have followed tax reform closely as it twisted and turned through Congress since the initial Tax Cuts and Jobs Act was released in early November,” said Hillen. The final language omits some provisions that concerned the independent school community, preserving current law for tuition remission, medical expense deductions, housing benefits and tax-exempt financing. Hillen credits this, in part, to NBOA’s collaboration with NAIS to advocate on behalf of independent schools, but she notes that some remaining provisions could impact schools positively as well as negatively.
Initial concerns that are alleviated in the final language, as analyzed by Hillen and Toscano:
Hillen recommends the article "Changes ahead for exempt organizations as vote nears on tax reform" by James Sweeney, a partner at RSM, for additional information on the tax bill's impact on independent schools.
Provisions impacting independent schools directly:
For questions or comments, contact Jennifer Osland Hillen, NBOA's director, tax and accounting programs, at firstname.lastname@example.org.
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