Title Details

Preface xi

PART I QUALIFICATIONS OF TAX-EXEMPT ORGANIZATIONS 1

CHAPTER 2 Qualifying Under IRC § 501(c)(3) 3

§ 2.1 Organizational Test 3

§ 2.2 Operational Test 4

CHAPTER 3 Religious Organizations 7

§ 3.2 Churches 7

CHAPTER 4 Charitable Organizations 9

§ 4.2 Promotion of Social Welfare 9

§ 4.6 Promotion of Health 9

CHAPTER 5 Educational, Scientific, and Literary Purposes,

and Prevention of Cruelty to Children and Animals 19

§ 5.1 Educational Purposes 19

CHAPTER 6 Civic Leagues and Local Associations of Employees: § 501(c)(4) 21

§ 6.1 Comparison of (c)(3) and (c)(4) Organizations 21

CHAPTER 7 Labor, Agricultural, and Horticultural Organizations:

§ 501(c)(5) 23

§ 7.2 Agricultural Groups 23

CHAPTER 8 Business Leagues: § 501(c)(6) 25

§ 8.2 Meaning of “Common Business Interest” 25

§ 8.3 Line of Business 25

CHAPTER 9 Social Clubs: § 501(c)(7) 27

§ 9.4 Revenue Tests 27

CHAPTER 11 Public Charities 29

§ 11.2 “Inherently Public Activity” and Broad Public Support

§ 509(a)(1) 29

§ 11.6 Supporting Organizations 30

PART II STANDARDS FOR PRIVATE FOUNDATIONS 39

CHAPTER 12 Private Foundations—General Concepts 41

§ 12.2 Special Rules Pertaining to Private Foundations 41

§ 12.4 Termination of Private Foundation Status 41

CHAPTER 13 Excise Tax Based on Investment Income: IRC § 4940 45

§ 13.2 Capital Gains 45

CHAPTER 14 Self-Dealing: IRC § 4941 47

§ 14.2 Sale, Exchange, or Lease of Property 47

§ 14.3 Loans 48

§ 14.4 Compensation 49

§ 14.7 Sharing Space, People, and Expenses 49

§ 14.9 Property Held by Fiduciaries 49

§ 14.10 Issues Once Self-Dealing Occurs 49

CHAPTER 15 Minimum Distribution Requirements: IRC § 4942 51

§ 15.2 Measuring Fair Market Value 51

§ 15.4 Qualifying Distributions 52

§ 15.6 Satisfying the Distribution Test 59

CHAPTER 16 Excess Business Holdings and Jeopardizing Investments:

IRC §§ 4943 and 4944 63

§ 16.1 Excess Business Holdings 63

§ 16.3 Program-Related Investments 64

§ 16.4 Penalty Taxes 65

CHAPTER 17 Taxable Expenditures: IRC § 4945 67

§ 17.3 Grants to Individuals 67

§ 17.4 Grants to Public Charities 69

§ 17.5 Grants to Foreign Organizations 71

PART III OBTAINING AND MAINTAINING TAX-EXEMPT STATUS 95

CHAPTER 18 IRS Filings, Procedures, and Policies 97

§ 18.1 Determination Process 97

§ 18.2 Annual Filing of Forms 990 98

§ 18.3 Reporting Organizational Changes to the IRS 103

§ 18.4 Weathering an IRS Examination 103

CHAPTER 19 Maintaining Exempt Status 119

§ 19.1 Checklists 119

CHAPTER 20 Private Inurement and Intermediate Sanctions 125

§ 20.1 Defining Inurement 125

§ 20.2 Salaries and Other Compensation 126

CHAPTER 21 Unrelated Business Income 127

§ 21.1 IRS Scrutiny of Unrelated Business Income 127

§ 21.8 Unrelated Activities 127

§ 21.10 Income Modifications 128

§ 21.12 Debt-Financed Property 128

§ 21.15 Publishing 129

CHAPTER 24 Deductibility and Disclosures 131

§ 24.1 Overview of Deductibility 131

§ 24.2 Substantiation and Quid Pro Quo Rules 132

CHAPTER 25 Employment Taxes 133

§ 25.2 Ministers 133

Index 135