Employee benefits for non-profits should be taxed. An employee by definition draws a wage and will be entitled to societal benefits in the future. Employers need to pay their taxes to support those benefits. There are many non-profits who abuse their status; religious groups where every member declares themselves as independent non-profit entities, charitable organizations whose paid telemarketing solicitors bombard us daily- and have administrative costs in excess of 30%; and other charitable organizations discovered to be outright frauds. If you can gather donations to pay an employee, you can pay taxes on their benefits. If a non-profit is a “righteous” organization, they should be able to find a volunteer to help with the paperwork.