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Coaches Tax Creates Salary Headaches for Nonprofits, CPAs Say

Feb. 20, 2020, 8:54 PM

Those millionaire coaches may have drummed up success in college football and basketball, but paying them has created headaches for those who write the checks.

A group representing certified public accountants is expressing concern that nonprofits aren’t receiving clear instructions on how to calculate compensation tied to a portion of the 2017 tax law designed to target highly-paid employees of tax-exempt organizations.

Tax Cuts and Jobs Act Section 4960—known as the coaches tax—imposes a 21% excise tax on a nonprofit’s five highest-paid employees making more than $1 million. There’s concern over how a university, hospital, museum, or charity...

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