The Service has ruled privately that a charitable remainder unitrust can be reformed from inception based on the finding the measuring term does not reflect the trustors' original intent. Of note in this case is the fact the trust was created with the help of the charitable remainderman and the trustors' family members, and without the assistance of a professional tax advisor.  MORE »

In two companion rulings, the Service has ruled privately that a merger of two public charities described in section 501(c)(3) will not result in the revocation of or otherwise adversely affect either organization's continued tax-exempt status as a public charity, will not generate unrelated business taxable income to either organization, and will not adversely affect the support test of either organization.  MORE »

The Service has ruled privately that a Real Estate Investment Trust's provision of steam and electricity to the tenants of a commercial office building are a customary service and, therefore, not considered impermissible services rendered to the occupants. Accordingly, rents received by the REIT will not be treated as unrelated business taxable income.  MORE »

The Service has ruled privately that investment units created by a university from its endowment fund for the purpose of investing in charitable remainder unitrusts for which the university serves as trustee are capital assets under section 1221. Accordingly, gain or loss upon the redemption of a unit will be short or long-term capital gain or loss to the unitrust depending on the holding period of the unit by the unitrust.  MORE »

The Service has denied tax-exempt status under section 501(c)(3) to an organization that is organized to facilitate contributions of real estate donations to colleges and universities on the basis the organization is not organized exclusively for charitable purposes. In addition, the Service ruled that since all of organization's activities constitute the operation of a commercial activity, it is organized and operated for the primary purpose of carrying on an unrelated trade or business.  MORE »

The Service has ruled privately that a private nonoperating foundation's proposed recapitalization of companies bequeathed to it by its founder will be permitted holdings, and its ownership of 100 percent of the stock of a corporation will not be considered excess business holdings because the  corporation is a functionally related business.

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The Service has ruled privately that a proposed distribution of assets from a testamentary trust to two charitable beneficiaries, that could not otherwise resolve a conflict regarding how income would be distributed and pursuant to a court-approved settlement agreement, will qualify for an estate tax charitable deduction.
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The Service has ruled privately that a private operating foundation's establishment of a financial awards program intended to recognize individuals for their past charitable, scientific, educational or literary achievements do not need pre-approval by the Internal Revenue Service, will not be taxable expenditures by the organization, and will be qualifying distributions.  MORE »

The IRS has approved a judicial reformation of a charitable remainder unitrust to correct a drafting error. The trust was drafted inadvertently as a net income makeup unitrust when a standard payout format was intended. The reformed trust will be treated as a standard unitrust from inception.  MORE »

The Service has ruled privately that the division of a charitable remainder trust pursuant to a marital separation agreement will not result in a private foundation termination tax under section 507, will not be an act of self-dealing under section 4941, and will not be a taxable expenditure under section 4945 of the Code.  MORE »