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More About This Title The Law of Tax-Exempt Organizations, 9th Edition 2009 Cumulative Supplement
PART ONE INTRODUCTION TO THE LAW OF TAX-EXEMPT ORGANIZATIONS.
Chapter One: Definition of and Rationales for Tax-Exempt Organizations.
*§ 1.1 Definition of Nonprofit Organization.
*§ 1.2 Definition of Tax-Exempt Organization.
*§ 1.3 Tax Exempt Organizations Law Philosophy.
*§ 1.4 Political Philosophy Rationale.
Chapter Two: Overview of Nonprofit Sector and Tax-Exempt Organizations.
*§ 2.1 Profile of Nonprofit Sector.
§ 2.2 Organization of IRS.
*(b) Tax Exempt and Government Entities Division.
*§ 2.3 Charitable Contribution Deduction Rules.
PART TWO FUNDAMENTALS OF THE LAW OF TAX-EXEMPT ORGANIZATIONS.
Chapter Three: Source, Advantages, and Disadvantages of Tax Exemption.
*§ 3.2 Recognition of Tax Exemption.
*§ 3.3 Advantages of Tax-Exempt Status.
(b) Deductibility of Contributions.
Chapter Four: Organizational, Operational, and Related Tests and Doctrines.
§ 4.1 Forms of Tax-Exempt Organizations.
(b) Check-the-Box Regulations.
(i) Basic Rules.
*§ 4.3 Organizational Test.
(a) Statement of Purposes.
*§ 4.5 Operational Test.
(a) Basic Rules.
*§ 4.7 Commensurate Test.
*§ 4.11 Commerciality Doctrine.
(b) Contemporary Application of Doctrine.
§ 4.12 Social Enterprise Movement.
Chapter Five: Boards of Directors and Governance Principles.
§ 5.1 Boards of Directors Basics.
*§ 5.2 Board Composition and Tax Law.
*§ 5.3 Duties and Responsibilities.
(a) Principles of Fiduciary Responsibility.
(b) Duties of Directors.
(ii) Duty of Loyalty.
*§ 5.5 Sarbanes-Oxley Act.
(b) Principal Features of Act.
(xiii) Real-Time Disclosures.
§ 5.6 Nonprofit Governance Principles.
(i) IRS Draft of Good Governance Principles (New).
(i) Mission Statement.
(ii) Code of Ethics.
(iii) Whistleblower Policy.
(iv) Due Diligence.
(v) Duty of Loyalty.
(vii) Fundraising Policy.
(viii) Financial Audits.
(ix) Compensation Practices.
(x) Document Retention Policy.
(j) American National Red Cross Governance Modernization Act (New).
(k) Panel on Nonprofit Sector Good Governance Principles (New).
(i) Legal Compliance and Public Disclosure.
(ii) Effective Governance.
(iii) Strong Financial Oversight.
(iv) Responsible Fundraising.
(l) Redesigned Form 990 (New).
*(m) IRS Life Cycle Educational Tool (New).
(iii) Organizational Documents.
(iv) Governing Body.
(v) Governance and Management Policies.
(vi) Financial Statements and Form 990 Reporting.
(vii) Transparency and Accountability.
*(n) IRS Ruling Policy (New).
*(o) College and University Compliance Questionnaire (New).
*(p) Exempt Organizations 2008 Annual Report (New).
PART THREE TAX-EXEMPT CHARITABLE ORGANIZATIONS.
∗Chapter Six: Concept of Charitable.
§ 6.1 Federal Tax Law Definition of Charitable.
*(b) Federal Tax Law Principles.
§ 6.2 Public Policy Doctrine.
*(a) General Principles.
(b) Race-Based Discrimination.
*(iii) Broader Policy Impact.
§ 6.3 Collateral Concepts.
*(a) Requirement of Charitable Class.
Chapter Seven: Charitable Organizations.
*§ 7.3 Credit Counseling.
(d) IRS Criteria for Example.
*§ 7.5 Down-Payment Assistance.
§ 7.6 Promotion of Health.
(i) Other Health Care Organizations.
§ 7.7 Lessening Burdens of Government.
*§ 7.8 Advancement of Education.
§ 7.14 Instrumentalities of Government.
*§ 7.15 Other Categories of Charity.
(b) Promotion of Patriotism.
Chapter Eight: Educational Organizations.
§ 8.2 Education Contrasted with Propaganda.
*§ 8.3 Educational Institutions.
(a) Schools, Colleges, and Universities.
*§ 8.6 Educational Activity as Commercial Business.
Chapter Ten: Religious Organizations.
§ 10.3 Churches and Similar Institutions.
(a) General Principles.
*§ 10.4 Conventions or Associations of Churches.
Chapter Eleven: Other Charitable Organizations.
*§ 11.2 Amateur Sports Organizations.
§ 11.8 Donor-Advised Fund Entities.
(e) Statutory Criteria.
§ 11.9 Endowment Funds (New).
*(a) Definition of Endowment Fund.
(b) Focus on College and University Endowments.
(c) Form 990 Reporting.
(d) Policy Options to Increase Payout.
*(e) College and University Questionnaire (New).
Chapter Twelve: Public Charities and Private Foundations.
§ 12.3 Categories of Public Charities.
(b) Publicly Supported Charities.
*(i) Donative Publicly Supported Charities—In General.
*(ii) Facts-and-Circumstances Test.
*(iii) Community Foundations.
*(iv) Service Provider Publicly Supported Organizations.
(c) Supporting Organizations.
§ 12.4 Private Foundation Rules.
(f) Other Provisions.
PART FOUR OTHER TAX-EXEMPT ORGANIZATIONS.
Chapter Thirteen: Social Welfare Organizations.
§ 13.1 Concept of Social Welfare.
(b) Benefits to Members.
§ 13.2 Requirement of Community.
*(a) Community and Condominium Associations.
*(b) Broader Requirement of Community.
*§ 13.3 Advocacy Organizations.
Chapter Fourteen: Business Leagues and Like Organizations.
§ 14.1 Concept of Business League.
(c) Line-of-Business Requirement.
*(iii) Other Developments.
(d) Membership Services.
§ 14.2 Disqualifying Activities.
*(a) Line-of-Business Requirement.
*(b) For-Profit Business Activities.
(i) General Rule.
(c) Performance of Particular Services.
*(i) Particular Services.
*(ii) General Rule.
§ 14.3 Chambers of Commerce.
∗Chapter Fifteen: Social Clubs.
§ 15.3 Investment Income Limitation.
§ 15.6 Sale of Club Assets.
Chapter Sixteen: Labor, Agricultural, and Horticultural Organizations.
§ 16.2 Agricultural Organizations.
Chapter Seventeen: Political Organizations.
§ 17.6 Taxation of Other Exempt Organizations.
§ 17.8 Independent Political Action Committees.
Chapter Eighteen: Employee Benefit Funds.
*§ 18.3 Voluntary Employees’ Beneficiary Associations.
Chapter Nineteen: Other Tax-Exempt Organizations.
§ 19.5 Benevolent or Mutual Organizations.
(b) Mutual Organizations.
§ 19.9 Insurance Companies and Associations.
*(a) Present Law.
*§ 19.12 Farmers’ Cooperatives.
§ 19.17 Qualified Tuition Programs.
*(c) Other Rules.
§ 19.22 Proposed Exempt Organizations.
PART FIVE PRINCIPAL EXEMPT ORGANIZATION LAWS.
Chapter Twenty: Private Inurement and Private Benefit.
§ 20.1 Concept of Private Inurement.
§ 20.4 Compensation Issues.
*(b) Determining Reasonableness of Compensation.
(e) Role of Board.
*(i) IRS College and University Questionnaire (New).
*(j) Illegal Payments (New).
§ 20.9 Private Inurement and Business Leagues.
§ 20.11 Private Benefit Doctrine.
*(a) General Rules.
(b) Joint Venture Law.
*(d) Doctrine and IRS Governance Enforcement (New).
Chapter Twenty-One: Intermediate Sanctions.
*§ 21.2 Tax-Exempt Organizations Involved.
§ 21.4 Transactions Involved.
(d) Automatic Excess Benefit Transactions and Supporting Organizations.
*§ 21.14 Return for Payment of Excise Taxes.
*§ 21.15 Statute of Limitations.
*§ 21.16 Interrelationship with Private Inurement Doctrine.
Chapter Twenty-Two: Legislative Activities by Tax-Exempt Organizations.
§ 22.6 Legislative Activities of Business Leagues.
*(a) Business Expense Deduction Disallowance Rules.
Chapter Twenty-Three: Political Campaign Activities by Tax-Exempt Organizations.
§ 23.2 Prohibition on Charitable Organizations.
*(b) Participation or Intervention.
(iii) Ascertaining Intervention.
(g) Activist Organizations.
*§ 23.5 Political Activities of Social Welfare Organizations.
(a) Allowable Campaign Activity.
(b) Political Campaign Activities.
*§ 23.10 Internet Communications.
§ 23.11 Federal Election Law.
(h) Hosting Debates.
*(i) Millionaires’ Amendment (New).
Chapter Twenty-Four: Unrelated Business Activities.
§ 24.1 Introduction to Unrelated Business Rules.
§ 24.2 Definition of Trade or Business.
(b) Requirement of Profit Motive.
(h) Real Estate Development Activities.
§ 24.4 Definition of Substantially Related.
(a) General Principles.
(f) Related Business Activities.
§ 24.5 Contemporary Applications of Unrelated Business Rules.
(a) Educational Institutions.
(b) Health Care Providers.
(ii) Sales of Pharmaceuticals.
(e) Business Leagues.
(ii) Insurance Programs.
(j.1) Sales of Merchandise (New).
(k) Share-Crop Leasing.
(o) Other Organizations’ Exempt Functions.
§ 24.6 Modifications.
(iii) Related Rental Activities.
(i) Other Investment Income.
§ 24.7 Exceptions.
(f) Trade Shows.
*(j) Low-Cost Articles.
*(l) Associate Member Dues.
*§ 24.8 Corporate Sponsorships.
*§ 24.12 Unrelated Debt-Financed Income.
(b) Debt-Financed Property.
*§ 24.15 College and University Compliance Questionnaire (New).
PART SIX ACQUISITION ANDMAINTENANCE OF TAX EXEMPTION.
Chapter Twenty-Five: Exemption Recognition and Notice Processes.
§ 25.1 Recognition Application Procedure.
(a) General Procedures.
*(i) Required Information.
(ii) Other Procedural Elements.
(b) Substantially Completed Application.
(c) Issuance of Determinations and Rulings.
(d) User Fees.
§ 25.2 Requirements for Charitable Organizations.
*(a) General Rules.
(d) Application Processing Backlog (New).
§ 25.3 Nonprivate Foundation Status.
*(a) Notice Requirement.
*(c) New Rules for Publicly Supported Charities (New).
§ 25.6 Group Exemption Rules.
§ 25.7 Suspension of Tax Exemption.
§ 25.8 Notice Requirements for Political Organizations.
Chapter Twenty-Six: Administrative and Litigation Procedures.
§ 26.1 Administrative ProceduresWhere Recognition Denied.
§ 26.2 Revocation of Tax-Exempt Status: Litigation Procedures.
(b) Declaratory Judgment Rules.
(i) General Requirements.
(ii) Exhaustion of Administrative Remedies.
*§ 26.3 Retroactive Revocation of Tax-Exempt Status.
§ 26.6 IRS Examination Procedures and Practices.
(a) General IRS Exempt Organizations Audit Procedures and Practices.
*(i) General Procedures.
*(ii) Types of Examinations.
(iv) Coping with Examination.
(b) IRS Exempt Organizations Examination Guidelines.
*(b.1) Fast-Track Settlement Process (New).
*(c) Church Audits.
§ 26.7 IRS Disclosure to State Officials.
Chapter Twenty-Seven: Operational Requirements.
§ 27.1 Changes in Operations or Form.
(a) Changes in Operations.
§ 27.2 Annual Reporting Rules.
(a) Contents of Annual Information Return.
(i) Form 990.
(b) Exceptions to Reporting Requirements.
(ii) Small Organizations.
§ 27.2A Redesigned Annual Information Return (New).
(a) IRS Guiding Principles.
(b) Summary of Redesigned Annual Information Return.
(i) Part I (Summary).
(ii) Part III.
(iii) Part IV.
(iv) Part V.
(v) Part VI.
(vi) Part VII.
(vii) Parts VIII–XI.
(viii) Schedule A.
(ix) Schedule B.
(x) Schedule C.
(xi) Schedule D.
(xii) Schedule E.
(xiii) Schedule F.
(xiv) Schedule G.
(xv) Schedule H.
(xvi) Schedule I.
(xvii) Schedule J.
(xviii) Schedule K.
(xix) Schedule L.
(xx) Schedule M.
(xxi) Schedule N.
(xxii) Schedule O.
(xxiii) Schedule R.
(xxiv) Transition Rules.
*(c) Implementing Regulations (New).
(i) Compensation Reporting.
(ii) Asset Disposition Reporting.
*(d) Instructions (New).
(i) Draft Instructions for Part VI (Governance).
(ii) Draft Instructions for Schedule G (Fundraising and Gaming).
(iii) Draft Instructions for Schedule M (Non-Cash Contributions).
(iv) Draft Instructions for Schedule A (Public Charities).
(v) Draft Instructions for Schedule F (Foreign Activities).
(vi) Draft Instructions for Schedule L (Transactions with Interested Persons).
(vii) Draft Instructions for Schedule N (Significant Dispositions).
(viii) Final Instructions.
(ix) Sequencing List.
§ 27.3 Small Organizations Notification Requirement.
*§ 27.4 Filing Requirements and Tax-Exempt Status.
§ 27.5 Reporting by Political Organizations.
(a) General Rules.
*§ 27.7 Unrelated Business Income Tax Returns.
§ 27.8 IRS Document Disclosure Rules.
(a) Federal Tax Law Disclosure Requirements.
(ii) Exempt Organizations Documents.
§ 27.9 Document Disclosure Obligations of Exempt Organizations.
(a) General Rules.
§ 27.12 Insurance Activities.
(c) Applicable Insurance Contract Reporting Requirements.
§ 27.14 Tax-Exempt Entity Leasing Rules.
(h) Interrelationship with Certain Tax Shelter Rules (New).
§ 27.15 Tax-Exempt Organizations and Tax Shelters.
*(j) Excise Tax Penalties.
PART SEVEN INTERORGANIZATIONAL STRUCTURES AND OPERATIONAL FORMS.
Chapter Twenty-Nine: Tax-Exempt Organizations and For-Profit Subsidiaries.
*§ 29.2 Potential of Attribution to Parent.
§ 29.7 Revenue from For-Profit Subsidiary.
(b) Tax Treatment of Income from Subsidiary.
*(d) Temporary Rule.
Chapter Thirty: Tax-Exempt Organizations and Joint Ventures.
§ 30.5 Low-Income Housing Ventures.
§ 30.7 Alternatives to Partnerships.
Chapter Thirty-One: Tax-Exempt Organizations and Restructuring.
*§ 31.3 Mergers.
§ 31.6 Single-Member Limited Liability Companies.
Table of Cases.
Table of IRS Revenue Rulings.
Table of IRS Revenue Procedures.
Table of IRS Private Determinations Cited in Text.
Table of IRS Private Letter Rulings, Technical Advice Memoranda, and General Counsel Memoranda.
Table of Cases Discussed in Bruce R. Hopkins’ Nonprofit Counsel.
Table of IRS Private Determinations Discussed in Bruce R. Hopkins’ Nonprofit Counsel.