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

§ 4.3 Lessening Burdens of Government 9

§ 4.6 Promotion of Health 10

CHAPTER 5 Educational, Scientific, and Literary Purposes, and Prevention of Cruelty to Children and Animals 23

§ 5.1 Educational Purposes 23

CHAPTER 6 Civic Leagues and Local Associations of Employees: § 501(c)(4) 25

§ 6.1 Comparison of (c)(3) and (c)(4) Organizations 25

§ 6.2 Qualifying and Nonqualifying Civic Organizations 26

§ 6.5 Disclosures of Nondeductibility 27

CHAPTER 7 Labor, Agricultural, and Horticultural Organizations: § 501(c)(5) 29

§ 7.2 Agricultural Groups 29

CHAPTER 8 Business Leagues: § 501(c)(6) 31

§ 8.2 Meaning of “Common Business Interest” 31

§ 8.3 Line of Business 31

§ 8.4 Rendering Services for Members 32

CHAPTER 9 Social Clubs: § 501(c)(7) 33

§ 9.4 Revenue Tests 33

*CHAPTER 10 Instrumentalities of Government and Title-Holding Organizations 35

§ 10.3 Qualifying for § 501(c)(3) Status 35

CHAPTER 11 Public Charities 37

§ 11.2 “Inherently Public Activity” and Broad Public Support: § 509(a)(1) 37

§ 11.6 Supporting Organizations 38

PART II STANDARDS FOR PRIVATE FOUNDATIONS 47

CHAPTER 12 Private Foundations—General Concepts 49

§ 12.2 Special Rules Pertaining to Private Foundations 49

§ 12.4 Termination of Private Foundation Status 50

CHAPTER 13 Excise Tax Based on Investment Income: IRC § 4940 53

§ 13.2 Capital Gains 53

CHAPTER 14 Self-Dealing: IRC § 4941 55

§ 14.1 Definition of Self-Dealing 55

§ 14.2 Sale, Exchange, or Lease of Property 56

§ 14.3 Loans 57

§ 14.4 Compensation 57

§ 14.7 Sharing Space, People, and Expenses 58

§ 14.9 Property Held by Fiduciaries 58

§ 14.10 Issues Once Self-Dealing Occurs 58

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CHAPTER 15 Minimum Distribution Requirements: IRC § 4942 59

§ 15.1 Assets Used to Calculate Minimum Investment Return 59

§ 15.2 Measuring Fair Market Value 60

§ 15.4 Qualifying Distributions 60

§ 15.6 Satisfying the Distribution Test 67

CHAPTER 16 Excess Business Holdings and Jeopardizing Investments: IRC §§ 4943 and 4944 71

§ 16.1 Excess Business Holdings 71

§ 16.3 Program-Related Investments 72

§ 16.4 Penalty Taxes 73

CHAPTER 17 Taxable Expenditures: IRC § 4945 75

§ 17.3 Grants to Individuals 75

§ 17.4 Grants to Public Charities 77

§ 17.5 Grants to Foreign Organizations 79

PART III OBTAINING AND MAINTAINING TAX-EXEMPT STATUS 107

CHAPTER 18 IRS Filings, Procedures, and Policies 109

§ 18.1 Determination Process 109

§ 18.2 Annual Filing of Forms 990 112

§ 18.3 Reporting Organizational Changes to the IRS 118

§ 18.4 Weathering an IRS Examination 118

CHAPTER 19 Maintaining Exempt Status 135

§ 19.1 Checklists 135

CHAPTER 20 Private Inurement and Intermediate Sanctions 141

§ 20.1 Defining Inurement 142

§ 20.2 Salaries and Other Compensation 142

§ 20.8 Services Rendered for Individuals 143

CHAPTER 21 Unrelated Business Income 145

§ 21.1 IRS Scrutiny of Unrelated Business Income 145

§ 21.5 What Is Unrelated Business Income? 146

§ 21.8 Unrelated Activities 146

§ 21.10 Income Modifications 147

§ 21.12 Debt-Financed Property 147

§ 21.15 Publishing 148

*CHAPTER 23 Electioneering and Lobbying 149

§ 23.1 Election Campaign Involvement 149

CHAPTER 24 Deductibility and Disclosures 151

§ 24.1 Overview of Deductibility 151

§ 24.2 Substantiation and Quid Pro Quo Rules 153

CHAPTER 25 Employment Taxes 155

§ 25.2 Ministers 155

*Appendix 25–1: Client Newsletter (New) 156

Index 159