Excise taxes and the Boogeyman

There are few things that are more certain than death and taxes. And at some point taxes catch up with us all even if you are just playing the boardgame Monopoly. Only this guy is more certain:

You probably thought I was going to refer to the Grim Reaper. You can cheat death, but you cannot cheat John Wick. And please do not mess with his dog.

In the original John Wick, Theon Greyjoy – or to be more accurate the actor who plays him in Game of Thrones – ignites John’s quest for justice by stealing his vintage Ford Mustang and harming John’s puppy.  Bad idea. Very bad idea.

But back to taxes. Section 13602 of the Tax Cuts and Jobs Act added section 4960 to the Internal Revenue Code in 2017. Section 4960 requires applicable tax-exempt organizations (ATEO) and related organizations to pay excise taxes on excess remuneration over $1 million and excess parachute payments made to covered employees. The excise tax is important to credit unions – as ATEOs – and their related CUSOs because they may be subject to the excise tax. Both the NAFCU Compliance team and NAFCU Services blogged about the excise tax last year.

 

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