​In particular, charities and NPOs that hold assets in trust on behalf of others through trustee arrangements (including bare trusts), may be surprised to find that they could be required to disclose information about these arrangements under the proposed enhanced trust reporting rules. Charities and NPOs should also consider whether the new reporting rules, which apply for filings due as early as March 31, 2023, may apply to trust arrangements in which property is held on their behalf, such as through a charitable remainder trust, in the case of a charity.

Although these rules have not yet been enacted into law, charities and NPOs should take action now to prepare to collect any required information needed for these new tax filings. Organizations that do not report as required may be subject to significant penalties.

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