Despite the simple and catchy sound-bites, the “no tax on tips” and “no tax on overtime” opportunities under the One Big Beautiful Bill Act (the “OBBBA”) have limits and require administration by both employers and employees. Most significantly, the tax savings are in the form of deductions, rather than exclusions, which means that tips and
tax reform
The One Big Beautiful Bill Act (Tax Reform): Employee Benefits and Executive Compensation Breakdown
By Tyler Forni & Erik Hays on
On May 22, 2025, the House of Representatives passed legislation titled “The One Big Beautiful Bill Act” (the “House Bill”) (available here), which includes several tax reform provisions. The House Bill is now being considered by the Senate.
If passed by the Senate and signed by the President, the House Bill would extend and/or modify…
New Excise Tax For Tax-Exempts Can Ensnare For-Profit Employers: Comment Deadline Fast Approaching
By Seth Safra, Steven Weinstein & Damian A. Myers on
As discussed here, the IRS’s initial interpretation of a new excise tax under Section 4960 of the Internal Revenue Code could catch for-profit employers who set up foundations, trusts, PACs, and other tax-exempt entities off guard. The tax is 21% of certain compensation paid to the top five highest paid employees of the tax-exempt…
Interim Guidance Released on Excise Tax on Executive Compensation Paid by Tax-Exempt Organizations
By Steven Einhorn on
The Department of the Treasury and the Internal Revenue Service recently released Notice 2019-09 (the “Notice”), which provides interim guidance under Section 4960 of the Internal Revenue Code.
Section 4960 was added to the Internal Revenue Code as part of the tax reform legislation that was enacted on December 22, 2017. Very generally, Section 4960…