The Tax Law of Private Foundations

by Hamilton, Shane T.; Hopkins, Bruce R.

• ISBN13: 9781394214754
• ISBN10: 1394214758
• Edition: 6th
• Format: Hardcover
• Copyright: 2023-12-19
• Publisher: Wiley

Summary

Insightful analysis and clarification of private foundation tax law combined with hands-on practice tools that make compliance simpler 

Now in its sixth edition, The Tax Law of Private Foundations by Bruce Hopkins and Shane Hamilton serves as the ultimate reference for navigating the complex regulations faced by private foundations. This comprehensive book is regularly updated to incorporate the latest changes in tax law, providing executives and professionals with valuable clarification, expert insights, and practical instruction. 

With each edition supplemented annually, readers can rely on the book to remain current and relevant. It offers a clear and concise summary of the regulations governing private foundations, unveiling the logic underpinning the rules. The authors provide a range of helpful tools, including checklists, sample documents, and practice forms, to simplify the filing process and ensure compliance with the latest legislation. 
Readers will also find: 

• Critical analyses and considerations of existing laws and regulations, shedding light on potential confusion arising from future legislation. 
• A collection of practical tools that make it simpler to maintain compliance with the regulations governing private foundations 
• Expert guidance on obtaining or maintaining your foundation’s tax-exempt status 

An indispensable resource, this latest edition caters to individuals with personal or professional interests in private foundations, offering authoritative guidance and illuminating explanations in an intricate and perplexing area of the law. Whether navigating the complexities of compliance or seeking deep insights, this book remains the gold standard for understanding and managing the complexities of private foundation taxation. 

Table of Contents

Preface

Book Citations  

1 Introduction to Private Foundations    

§ 1.1 Private Foundations: Unique Organizations

§ 1.2 Definition of Private Foundation

§ 1.3 Background            

§ 1.4 Private Foundation Law Primer       

§ 1.5 Definition of Charity            

§ 1.6 Operating for Charitable Purposes

§ 1.7 Organizational Rules           

§ 1.8 Private Foundation Law Sanctions 

§ 1.9 Statistical Profile  

§ 1.10 Private Foundations and Law 50 Years Later           

2 Starting, Funding, and Governing a Private Foundation               

§ 2.1 Alternatives to Private Foundations             

§ 2.2 Advantages of Private Foundations              

§ 2.3 Choice of Organizational Form

§ 2.4 Funding a Foundation        

§ 2.5 Estate Planning Principles

§ 2.6 Foundations and Planned Giving

§ 2.7 Acquiring Recognition of Tax-Exempt Status            

§ 2.8 Governance           

3 Types of Private Foundations

§ 3.1 Private Operating Foundations

§ 3.2 Exempt Operating Foundations

§ 3.3 Conduit Foundations

§ 3.4 Common Fund Foundations

§ 3.5 Research and Experimentation Funds         

§ 3.6 Other Types of Foundations            

§ 3.7 Nonexempt Charitable Trusts

§ 3.8 Split-Interest Trusts

§ 3.9 Foreign Private Foundations

4 Disqualified Persons   

§ 4.1 Substantial Contributors    

§ 4.2 Foundation Managers        

§ 4.3 Certain 20 Percent Owners              

§ 4.4 Family Members  

§ 4.5 Corporations or Partnerships

§ 4.6 Trusts or Estates

§ 4.7 Private Foundations

§ 4.8 Governmental Officials

§ 4.9 Termination of Disqualified Person Status

5 Self-Dealing   

§ 5.1 Private Inurement Doctrine             

§ 5.2 Private Benefit Doctrine    

§ 5.3 General Definition of Self-Dealing

§ 5.4 Sale, Exchange, Lease, or Furnishing of Property     

§ 5.5 Loans and Other Extensions of Credit          

§ 5.6 Payment of Compensation

§ 5.7 Indemnification and Insurance       

§ 5.8 Uses of Income or Assets by Disqualified Persons

§ 5.9 Sharing Space, People, and Expenses

§ 5.10 Payments to Government Officials             

§ 5.11 Indirect Self-Dealing         

§ 5.12 Estate Administration Exception

§ 5.13 Early Terminations of Charitable Remainder Trusts             

§ 5.14 Additional Exceptions      

§ 5.15 Issues Once Self-Dealing Occurs   

6 Mandatory Distributions          

§ 6.1 Mandatory Distribution Requirement         

§ 6.2 Minimum Investment Return         

§ 6.3 Determining Fair Market Value

§ 6.4 Qualifying Distributions     

§ 6.5 Excise Taxes on Failure to Distribute Income

§ 6.6 History of the Mandatory Distribution Requirement             

7 Excess Business Holdings          

§ 7.1 General Rules        

§ 7.2 Permitted and Excess Holdings       

§ 7.3 Functionally Related Businesses

§ 7.4 Philanthropic Businesses

§ 7.5 Rules Applicable to Certain Supporting Organizations

§ 7.6 Rules Applicable to Donor-Advised Funds

§ 7.7 Excise Taxes on Excess Holdings     

8 Jeopardizing Investments        

§ 8.1 General Rules

§ 8.2 Prudent Investments

§ 8.3 Program-Related Investments

§ 8.4 Investment Frauds

§ 8.5 Excise Taxes on Jeopardizing Investments

9 Taxable Expenditures

§ 9.1 Legislative Activities            

§ 9.2 Political Campaign Activities

§ 9.3 Grants to Individuals           

§ 9.4 Grants to Public Charities  

§ 9.5 Grants to Exempt Operating Foundations  

§ 9.6 Grants to Foreign Organizations

§ 9.7 Expenditure Responsibility               

§ 9.8 Spending for Noncharitable Purposes         

§ 9.9 Excise Tax on Taxable Expenditures             

10 Tax on Net Investment Income           

§ 10.1 Rate of Tax

§ 10.2 Payment of Tax   

§ 10.3 Planning Opportunities to Reduce Tax

§ 10.4 Formula for Taxable Income          

§ 10.5 Reductions to Gross Investment Income

§ 10.6 Foreign Foundations

§ 10.7 Exemption from Tax on Investment Income           

11 Unrelated Business Activity   

§ 11.1 General Rules      

§ 11.2 Exceptions            

§ 11.3 Rules Specifically Applicable to Private Foundations           

§ 11.4 Unrelated Debt-Financed Income Rules   

§ 11.5 Calculating and Reporting the Tax               

12 Tax Reporting and Administration Issues

§ 12.1 Form 990-PF

§ 12.2 Form 990-PF Penalties

§ 12.3 Public Disclosure and Inspection

§ 12.4 Reporting and Payment of Excise Taxes

§ 12.5 Determination Letters and Letter Rulings

§ 12.6 IRS Examinations of Private Foundations

§ 12.7 Revocation of Tax-Exempt Status

13 Termination of Foundation Status      

§ 13.1 Voluntary Termination

§ 13.2 Involuntary Termination

§ 13.3 Transfer of Assets to a Public Charity         

§ 13.4 Operation as a Public Charity

§ 13.5 Mergers, Split-Ups, and Transfers Between Foundations  

§ 13.6 Termination of Trusts Treated as Private Foundations

§ 13.7 Termination Tax

§ 13.8 Abatement           

14 Charitable Giving Rules           

§ 14.1 Concept of Gift   

§ 14.2 Basic Rules

§ 14.3 Gifts of Appreciated Property      

§ 14.4 Deduction Reduction Rules            

§ 14.5 Qualified Appreciated Stock Rule

§ 14.6 Special Gift Situations

§ 14.7 Administrative Considerations

15 Public Charities          

§ 15.1 Advantages of Public Charity Status

§ 15.2 Statutory Categories of Public Charities    

§ 15.3 Public Institution Charities             

§ 15.4 Donative Publicly Supported Charities      

§ 15.5 Service Provider Publicly Supported Charities        

§ 15.6 Supporting Organizations               

§ 15.7 Change of Public Charity Category

§ 15.8 Termination of Public Charity Status          

§ 15.9 Relationships Created for Avoidance Purposes     

16 Donor-Advised Funds              

§ 16.1 Basic Definitions

§ 16.2 General Concept of a Gift

§ 16.3 Types of Donor Funds

§ 16.4 Donor-Advised Fund Litigation

§ 16.5 Public Charity Status of Funds

§ 16.6 Interrelationship of Private Foundation Rules        

§ 16.7 Statutory Criteria

§ 16.8 Studies   

§ 16.9 Tax Regulations

§ 16.10 Proposed Legislation

17 Company Foundations            

§ 17.1 Company Foundation Overview  

§ 17.2 Reasons for Establishment of a Company Foundation

§ 17.3 Private Inurement Doctrine           

§ 17.4 Private Benefit Doctrine  

§ 17.5 Disqualified Persons Rules             

§ 17.6 Self-Dealing Rules              

§ 17.7 Other Private Foundations Rules

§ 17.8 Excess Executive Compensation Tax Exceptions

COMP the below highlighted tables should be typeset, but place in book only if page count is an issue. Otherwise they will appear on website only and not listed in TOC.

Appendix A—Sources of Law

Appendix B—Internal Revenue Code Sections

Table of Cases   

Table of IRS Revenue Rulings and Revenue Procedures  

Table of IRS Private Determinations Cited in Text              

About the Author            

About the Online Resources

Cumulative Index