Insights & News

Tax Insights, December 12, 2018
SIFMA and NACUBO Comment on UBTI Guidance

December 12, 2018
Publications
IRS Releases Information on Tax Rules for Federal Use of Prisons Financed by Exempt State Bonds
The IRS issued an Issue Snapshot discussing the rules that apply when the federal government and its agencies use prison facilities financed by tax-exempt bonds issued by state and local governments, and the circumstances under which such use may be considered “private business use” under Section 141(b). (Section references are to the Internal Revenue Code of 1986, as amended.)

IRS Information Release Reminds Taxpayers of Changes to ABLE Accounts
The IRS issued an information release reminding taxpayers that for individuals with disabilities the 2017 Tax Cuts and Jobs Act made changes to Achieving a Better Life Experience (ABLE) accounts, including allowing eligible individuals to add more money and to roll funds from Section 529 plans, into their ABLE accounts. Certain contributions to ABLE accounts by low- and moderate-income workers could also qualify for the Saver’s Credit.

IRS Releases Fact Sheet on Reconstructing Records After Disasters
The IRS has issued a fact sheet (FS-2018-18) providing guidance on reconstructing financial records following a disaster. The IRS notes that reconstructing may be essential for tax purposes, getting federal assistance or obtaining insurance reimbursement.

SIFMA Comments on UBTI Guidance
The Securities Industry and Financial Markets Association commented on unrelated business taxable income (UBTI) guidance issued by the IRS (Notice 2018-67). Notice 2018-67 provides interim rules for determining whether a tax-exempt organization has more than one unrelated trade or business and how to calculate unrelated business taxable income with respect thereto, pending the issuance of regulations. The Notice also addresses the net operating loss deduction and treatment of global intangible low-taxed income for purposes of determining the unrelated business income tax.

NACUBO Outlines Thoughts on UBTI Guidance
The National Association of College and University Business Officers, on behalf of several education organizations, also commented on UBTI guidance (Notice 2018-67), suggesting how separate trades or businesses should be identified, seeking clarifications on some UBTI offsets, and seeking changes regarding investment partnership interests.

Information contained in this publication should not be construed as legal advice or opinion or as a substitute for the advice of counsel. The articles by these authors may have first appeared in other publications. The content provided is for educational and informational purposes for the use of clients and others who may be interested in the subject matter. We recommend that readers seek specific advice from counsel about particular matters of interest. 

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