Searching the PGDC is Simple!

Marc Hoffman — Mon, 30 Apr 2012 20:39:37 +0000

Need to find something fast on the PGDC? Get the most out of your research on the PGDC by following a few simple rules. Read more »

Service Approves Ascending Payment Charitable Lead Annuity Trust

Marc Hoffman — Mon, 30 Apr 2012 19:34:19 +0000

The IRS has ruled privately that a state court's order to permit optional variable ascending annuity payments from a testamentary charitable lead annuity trust, commencing on the decedent's death and continuing for the 10-year annuity term, will satisfy the requirements of § 2055(e)(2) and, therefore, property of the taxable estate of the decedent passing to the charitable lead trust will qualify for a charitable deduction under § 2055(a). Also ruled: The construction will permit payments from the trust will be deductiblle to it under §642; will not cause a termination of your private foundation status under §507; will not be a prohibited act of self-dealing under §4941; would not cause a failure to distribute income under §4942; would not trigger an excise taxes on excess business holdings, jeopardizing investments, or taxable expenditures under §§4943, 4944 and 4945; Read more »

May 7520 Rate Up a Tick to 1.6%

Marc Hoffman — Wed, 18 Apr 2012 21:04:49 +0000

For purposes of determining the present value of an annuity, an interest for life or a term of years, or a remainder or a reversionary interest, Revenue Ruling 2012-13 indicates the applicable federal rate under section 7520 for May 2012 is 1.6%; up 0.2% from the April and March rates of 1.4%. Read more »

Service Issues Final Regs Regarding Ordering Provisions from Estates and Trusts to Charity

Marc Hoffman — Tue, 17 Apr 2012 20:58:54 +0000

The IRS has released final regulations under section 642(c) with regard to the Federal tax consequences of an ordering provision in a trust, a will, or a provision of local law that attempts to determine the tax character of the amounts paid to a charitable beneficiary of the trust or estate. The final regulations also make conforming amendments to the regulations under section 643(a)(5) and affects estates, charitable lead trusts (CLTs), and other trusts making payments or permanently setting aside amounts for a charitable purpose. Read more »

Universal E-File Key to Transparency

Marc Hoffman — Thu, 12 Apr 2012 16:59:13 +0000

Current law permitts the filing of Form 990 by paper or electronic means. In this article, Dennis Walsh, CPA makes the argument for requiring that e-filing of Form 990 be made mandatory. Read more »

Attorney Suggests Three Exceptions/Clarifications to Charitable Appraisal Rules

Marc Hoffman — Thu, 12 Apr 2012 15:43:17 +0000

In response to IRS Notice 2012-25, which requests items for inclusion in the 2012-2013 Guidance Priority List, attorney Lawrence P. Katzenstein of of Thompson Coburn LLP has suggested three exceptions or clarifications be made to the qualified appraisal requirements for charitable contributions. Read more »

Confirming Exempt Status

Marc Hoffman — Sun, 08 Apr 2012 22:33:50 +0000

The IRS has responded to an inquiry regarding to what extent donors, grantors, and contributors may rely on the listing of an organization in Publication 78, Cumulative List of Organizations or the IRS Business Master File (BMF) extract for purposes of deducting contributions under section 170 and for making grants under sections 4942, 4945, and 4966. Read more »

Swap of Easement Not Deductible

Marc Hoffman — Sun, 08 Apr 2012 21:34:33 +0000

The IRS has clarified that, except in very limited situations, a contribution of an easement subject to the condition the easement can be swapped is not deductible under section 170(h). Read more »

Deduction for Conservation Easement on Debt Encumbered Property Denied

Marc Hoffman — Wed, 04 Apr 2012 15:21:17 +0000

According to the income tax regulations, no income tax charitable deduction is permitted for a conservation easement in property which is subject to a mortgage unless the mortgagee subordinates its rights in the property to the right of the qualified organization to enforce the conservation purposes of the gift in perpetuity. In this case, the mortgagee did not do that. Although the donor argued the possibility of defaulting on the promissory note was so-remote-as-to-be-negligible, the court found that standard did not apply because the ability to foreclose on the property and extinguish the conservation agreement still existed in the event of default. The court denied the deduction, but waived accuracy-related penalties. Read more »

New Publication on Tax on Unrelated Business Income of Exempt Organizations

Marc Hoffman — Tue, 27 Mar 2012 18:22:21 +0000

The IRS has released Publication 598, Tax on Unrelated Business Income of Exempt Organizations, in which it describes which organizations are subject to the tax, return filing requirements, what an unrelated trade or business is, and how to calculate unrelated business taxable income. Read more »