At a time when funders and nonprofits may need expertise and unique insights to navigate the complex issues of our sector, a new 21 percent excise tax may affect their ability to retain and recruit high caliber talent to make such high stakes decisions.

The U.S. Department of the Treasury and the Internal Revenue Service are finalizing guidance for Notice 2019-09, which applies a 21 percent tax when an employee is earning in excess of $1 million and is “one of the tax-exempt organization’s five highest-compensated employees, including pay from related organizations.”

The tax is a component