Healthcare NPOs Seeing Status Challenged Due To Comp

Nonprofit healthcare organizations could start seeing their tax-exempt status challenged due to questions about executive compensation if recent le...

March 9, 2023
1:06 AM

Nonprofit healthcare organizations could start seeing their tax-exempt status challenged due to questions about executive compensation if recent legal developments in Pennsylvania and New Jersey are indications. The latest case involves a nonprofit healthcare corporation in Pennsylvania, where a state appeals court rejected the property tax exemption sought for four suburban Philadelphia hospitals whose executive pay and bonuses the court found to be excessive. The ruling by the Pennsylvania Commonwealth Court applies only to local and county property taxes, not to the parent health organization's designation as a federal 501(c)(3) nonprofit.