CHAPTER NINETaxable Expenditures

  1. § 9.1 Legislative Activities
    1. (b) Law Specifically Applicable to Private Foundations
  2. § 9.2 Political Campaign Activities
  3. *§ 9.3 Grants to Individuals
    1. (a) Grants for Travel, Study, or Other Purposes
    2. (g) Seeking Approval
  4. *§ 9.4 Grants to Public Charities
    1. (c) The Reliance Problem
  5. *§ 9.4A Grants to Exempt Operating Foundations
  6. § 9.5 Grants to Foreign Organizations
  7. *§ 9.6 Expenditure Responsibility
    1. (a) General Rules
  8. *§ 9.9 Distributions to Certain Supporting Organizations
  9. § 9.10 Excise Tax for Taxable Expenditures
    1. (b) Paying or Abating the Tax

§ 9.1 LEGISLATIVE ACTIVITIES

(b) Law Specifically Applicable to Private Foundations

p. 392. Insert following second complete paragraph, before heading:

A private foundation and its founder were found by the U.S. Tax Court to be liable for excise taxes as the result of cumulative taxable expenditures for producing and broadcasting radio messages that were held to be attempts to influence legislation.29.1 As a foundation manager, the founder agreed to the making of the expenditures. In addition to finding liability for the taxes, the court further determined that, because the taxable expenditures were not timely corrected, the foundation and its founder are liable for additional excise taxes.29.2

The messages, plus newspaper advertisements, were held to be direct lobbying expenditures because they were targeted at a state ballot initiative, where the voters are considered the legislative body.29.3 Legislative ...

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