Private Foundations

CHAPTER TWELETax Compliance and Administrative Issues

1. § 12.1 Successful Preparation of Form 990-PF
   1. (b) Line-by-Line Instructions
   2. (m) Part XV, Supplemental Information
2. § 12.2 Reports Unique to Private Foundations
   1. (n) Part XVI-A, Analysis of Income
3. § 12.3 Compliance Issues
   1. (a) Document Dissemination Rules
   2. (b) Where and When to File Form 990-PF

p. 556, fourth complete paragraph. Insert as last two sentences:

The public disclosure copy of the Form 990-PF must include Schedule B on which donors are listed with the amounts of their contributions for the year. This schedule can be omitted from the Form 990.

§ 12.1 SUCCESSFUL PREPARATION OF FORM 990-PF

p. 560. Insert as third complete paragraph:

Contemporary investment practices—hedge funds, private equity partnerships, puts and calls, currency leverages, and others—add complexity to tax compliance efforts for a private foundation. This supplement adds new checklists and sample work papers to aid in making the calculations and satisfying the much enhanced reporting required by these investments. The Checklist for Alternative Investments attached at the end of the supplemental materials for this chapter covers the myriad of issues raised in contemplating type of investment, as follows:

• Fiduciary responsibility for prudent investing is tested with questions that ask whether the character, risk, and expected return on the investments might result in a jeopardizing investment penalty.^16.1
• Possibility for excess business holdings ...