§ 10.1 INTRODUCTION
p. 697. Delete the regulations citation in footnote 2 and replace with the following:
Reg. § 1.501(c)(3)-1.
§ 10.2 EXCESS BUSINESS HOLDINGS: GENERAL RULES (REVISED)
p. 701. Add the following to the end of footnote 17:
See discussion in subsection 2.11(f) on contributions of LLC/partnership interest to charities.
pp. 703–704. Add the following to the end of footnote 29:
See also PLR 201414031(Apr. 4, 2014) (foundation permitted to correct excess business holdings by granting to public charities requisite amount of stock to bring foundation's holdings to 2 percent de minimis amount).
p. 704. Add the following at the end of the first paragraph on this page:
In February 2018 the Enterprise Act of 2017, as part of the Bi-Partisan Budget Act of 2018, added a provision that allows private foundations to retain 100 percent of a business under certain conditions. This will allow a private foundation to avoid the requirement to divest itself of at least 80 percent of its excess business holdings under § 4943.
New § 4943(g) permits a foundation to own 100 percent of a company provided:
- there are no other shareholders and the shares have been donated to the foundation or acquired in a manner other than purchase;
- the company must distribute all of its net operating income to the foundation within 120 ...