2010 Instruction 990-PF

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Page 1 of 32 Instructions for Form 990-PF 13:37 - 29-NOV-2010

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Department of the Treasury

Internal Revenue Service

2010

Instructions for Form 990-PF

Return of Private Foundation or Section 4947(a)(1) Nonexempt Charitable Trust

Treated as a Private Foundation

procedures, charitable trusts may also

Section references are to the Internal Contents Page

terminate their private foundation status

Revenue Code unless otherwise noted. Part V. Qualification Under

by operating as Type III supporting

Section 4940(e) for Reduced

Contents Page

organizations. See IRS Ann. 2010-19,

Tax on Net Investment

General Instructions

2010-14 I.R.B. 529, available at www.irs.

Income .................... 18

A. Who Must File .............. 2

gov/irb/2010–14_IRB/ar13.html.

Part VI. Excise Tax Based on

B. Which Parts To Complete ...... 2

Investment Income ........... 18

C. Definitions ................. 3

If the foundation is entitled to the new

Part VII-A. Statements

D. Other Forms You May

credit for small employer health insurance

Regarding Activities ........... 19

Need To File ................. 3

premiums under the Patient Protection

Part VII-B. Activities for Which

E. Useful Publications ........... 4 and Affordable Care Act, you must claim

Form 4720 May Be Required ... 20

the credit on Form 990-T, Exempt

F. Use of Form 990-PF To

Organization Business Income Tax

Satisfy State Reporting Part VIII. Information About

Return.

Requirements ................ 4 Officers, Directors, Trustees,

Foundation Managers, Highly

G. Furnishing Copies of Form

Paid Employees, and

990-PF to State Officials ........ 5

Reminders

Contractors ................. 22

H. Accounting Period ........... 5

If you are filing Form 990-PF because you

Part IX-A. Summary of Direct

I. Accounting Methods ........... 5

no longer meet a public support test

Charitable Activities ........... 23

J. When, Where, and How To

under section 509(a)(1) and you have not

File ....................... 5

Part IX-B. Summary of

previously filed Form 990-PF, check Initial

Program-Related

K. Extension of Time To File ...... 5

return of a former public charity in block G

Investments ................ 24

L. Amended Return ............. 5

of the Entity section on page 1 of your

return. Before filing Form 990-PF for the

Part X. Minimum Investment

M. Penalty for Failure To File

first time, you may want to go to www.irs.

Return .................... 24

Timely, Completely, or

gov/eo for the latest information and filing

Correctly .................... 6

Part XI. Distributable Amount ..... 25

tips to confirm you are no longer a

N. Penalties for Not Paying

Part XII. Qualifying

publicly supported organization.

Tax on Time ................. 6

Distributions ................ 25

O. Figuring and Paying

Part XIII. Undistributed Income ... 26

For annual tax periods beginning after

Estimated Tax ................ 6

Part XIV. Private Operating 2006, most tax-exempt organizations,

P. Tax Payment Methods for

other than churches, are required to file

Foundations ................ 27

Domestic Private

an annual Form 990, 990-EZ, or 990-PF

Part XV. Supplementary

Foundations ................. 6

with the IRS, or to submit a Form 990-N

Information ................. 28

Q. Public Inspection

e-Postcard to the IRS. If an organization

Part XVI-A. Analysis of

Requirements ................ 7

fails to file an annual return or notice as

Income-Producing Activities ..... 28

R. Disclosures Regarding

required for 3 consecutive years, it will

Part XVI-B. Relationship of

Certain Information and

automatically lose its tax-exempt status.

Activities to the

Services Furnished ............ 9

See General Instruction M.

Accomplishment of Exempt

S. Organizations Organized or

Purposes .................. 29

Created in a Foreign Country .... 9

Part XVII. Information

T. Liquidation, Dissolution,

Photographs of Missing

Regarding Transfers To and

Termination, or Substantial

Transactions and

Children

Contraction .................. 9

Relationships With

U. Filing Requirements During

The Internal Revenue Service is a proud

Noncharitable Exempt

Section 507(b)(1)(B)

partner with the National Center for

Organizations ............... 29

Termination ................ 10

Missing and Exploited Children.

Signature ................... 30

V. Special Rules for Section

Photographs of missing children selected

Paperwork Reduction Act

507(b)(1)(B) Terminations ...... 10 by the Center may appear in instructions

Notice .................... 30

on pages that would otherwise be blank.

W. Rounding, Currency, and

You can help bring these children home

Attachments ................ 10

Exclusion Codes .............. 31

by looking at the photographs and calling

Specific Instructions

Index ........................ 32

1-800-THE-LOST (1-800-843-5678) if you

Completing the Heading ........ 10

recognize a child.

Part I. Analysis of Revenue

What’s New

and Expenses ............... 11

The IRS has released new procedures

Part II. Balance Sheets ......... 15

Phone Help

under which a charitable trust may

Part III. Analysis of Changes in

If you have questions and/or need help

request a ruling that it was and continues

Net Assets or Fund Balances ... 17

completing this form, please call

to be a Type III supporting organization

Part IV. Capital Gains and

1-877-829-5500. This toll-free telephone

after August 16, 2007, and can obtain a

service is available Monday through

Losses for Tax on Investment

refund of any section 4940 tax paid for

Friday.

Income .................... 17 the 2008 tax year. Under these

Cat. No. 11290Y

Page 2 of 32 Instructions for Form 990-PF 13:37 - 29-NOV-2010

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•

You can e-file your Form 990-PF, Form

How To Get Forms and B. Which Parts To

940 and 941 employment tax returns, and

Publications

Complete

Form 1099 and other information returns.

Visit www.irs.gov/efile for details.

The parts of the form listed below do not

Internet

•

You can pay taxes online or by phone

apply to all filers. See How to avoid filing

using the free Electronic Federal Tax

You can access the IRS website at

an incomplete return on this page for

Payment System (EFTPS). Visit www.

IRS.gov 24 hours a day, 7 days a week

information on what to do if a part or an

eftps.gov or call 1-800-555-4477 for

to:

item does not apply.

details. Electronic Funds Withdrawal

•

E-file your return. See below for details

•

Part I, column (c), applies only to

(EFW) from a checking or savings

about e-filing many returns, including

private operating foundations and to

account is also available to those who file

Form 990-PF.

nonoperating private foundations that

electronically.

•

Download forms, including talking tax

have income from charitable activities.

forms, instructions, and publications.

For the most up-to-date tax

•

Part II, column (c), with the exception of

•

Order IRS products online.

information, please visit us at www.irs.

line 16, applies only to organizations

•

Research your tax questions online.

gov/formspubs/index.html and select

having at least $5,000 in assets per

•

Search publications online by topic or

Highlights of Recent Tax Changes under

books at some time during the year. Line

keyword.

the Important Changes section.

16, column (c), applies to all filers.

•

Use the online Internal Revenue Code,

•

Part IV does not apply to foreign

Regulations, or other official guidance.

organizations.

General Instructions

•

View Internal Revenue Bulletins (IRBs)

published in the last few years.

•

Parts V and VI do not apply to

Purpose of form. Form 990-PF is used:

•

organizations making an election under

•

To figure the tax based on investment

tax news by email.

section 41(e).

income, and

•

Get information on starting and

•

Part X does not apply to foreign

•

To report charitable distributions and

operating a private foundation.

foundations that check the box in D2 of

activities.

the Entity section on page 1 of Form

DVD for tax products

Also, Form 990-PF serves as a

990-PF unless they claim status as a

You can order Publication 1796, IRS Tax

substitute for the section 4947(a)(1)

private operating foundation.

Products DVD, and obtain:

nonexempt charitable trust’s income tax

•

Parts XI and XIII do not apply to foreign

return, Form 1041, U.S. Income Tax

•

Current-year forms, instructions, and

foundations that check the box in D2 of

Return for Estates and Trusts, when the

publications.

the Entity section on page 1 of Form

trust has no taxable income.

•

Prior-year forms, instructions, and

990-PF. However, check the box at the

publications.

top of Part XI. Part XI does not apply to

A. Who Must File

•

Tax Map: an electronic research tool

private operating foundations. Also, if the

and finding aid.

Form 990-PF is an annual information

organization is a private operating

•

Tax law frequently asked questions.

return that must be filed by:

foundation for any of the years shown in

•

Tax Topics from the IRS telephone

•

Exempt private foundations (section

Part XIII, do not complete the portions

response system.

6033(a), (b), and (c)),

that apply to those years.

•

Internal Revenue Code—Title 26 of the

•

Taxable private foundations (section

•

Part XIV applies only to private

U.S. Code.

6033(d)),

operating foundations.

•

Fill-in, print, and save features for most

•

Organizations that agree to private

•

Part XV applies only to foundations

tax forms.

foundation status and whose applications

having assets of $5,000 or more during

•

Internal Revenue Bulletins.

for exempt status are pending on the due

the year. This part does not apply to

•

Toll-free and email technical support.

date for filing Form 990-PF,

certain foreign organizations.

•

Two releases during the year.

•

Organizations that made an election

– The first release will ship the beginning

under section 41(e)(6),

How to avoid filing an incomplete

of January 2011.

•

Foundations that are making a section

return.

– The final release will ship the beginning

507 termination, and

•

Complete all applicable line items,

of March 2011.

•

Section 4947(a)(1) nonexempt

•

Answer “Yes,” “No,” or “N/A” (not

charitable trusts treated as private

Purchase the DVD from National

applicable) to each question on the

foundations (section 6033(d)).

Technical Information Service (NTIS) at

return,

www.irs.gov/cdorders for $30 (no

Include on the foundation’s return

•

Make an entry (including a zero when

handling fee) or call 1-877-233-6767 toll

the financial and other information

appropriate) on all total lines, and

free to buy the DVD for $30 (plus a $6

of any disregarded entity owned

TIP

•

Enter “None” or “N/A” if an entire part

handling fee).

by the foundation. See Regulations

does not apply.

sections 301.7701-1 through 3 for

By Phone and In Person

information on the classification of certain

You can order forms and publications by

Sequencing Chart To Complete

business organizations including an

calling 1-800-TAX-FORM

the Form

eligible entity that is disregarded as an

(1-800-829-3676). You can also get most

entity separate from its owner

You may find the following chart helpful. It

forms and publications at your local IRS

(disregarded entity).

limits jumping from one part of the form to

office.

another to compute an amount needed to

Other section 4947(a)(1) nonexempt

Use these electronic options to make

complete an earlier part. If you complete

charitable trusts. Section 4947(a)(1)

filing and paying easier.

the parts in the listed order below, any

nonexempt charitable trusts not treated

information you may need from another

as private foundations do not file Form

IRS E-Services Make

part will already be entered.

990-PF. However, they may need to file

Taxes Easier

Form 990, Return of Organization Exempt

Step Part Step Part

Now more than ever before, businesses From Income Tax, or Form 990-EZ, Short

1 ....... IV 8 ...... XII, lines 1 – 4

can enjoy the benefits of filing and paying Form Return of Organization Exempt

2 ....... I & II 9 ...... V & VI

their federal taxes electronically. Whether From Income Tax. With either of these

3 ....... Heading 10 ...... XII, lines 5 – 6

you rely on a tax professional or handle forms, the trust must also file Schedule A

4 ....... III 11 ...... XI

5 ....... VII-A 12 ...... XIII

your own taxes, the IRS offers you (Form 990 or 990-EZ), Public Charity

6 ....... VIII 13 ...... VII-B

convenient programs to make taxes Status and Public Support. See Form 990

7 ....... IX-A – X 14 ...... XIV – XVII

easier. and Form 990-EZ instructions.

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Form 990-PF Instructions

Page 3 of 32 Instructions for Form 990-PF 13:37 - 29-NOV-2010

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(See section 4946(c) and the related under section 501(a) with total gross

C. Definitions

regulations.) income of $1,000 or more from all trades

1. A private foundation is a domestic

g. For purposes of section 4943 or businesses unrelated to the

or foreign organization exempt from

(excess business holdings), a disqualified organization’s exempt purpose must file

income tax under section 501(a),

person also includes: Form 990-T. The form is also used by

described in section 501(c)(3), and is

i. A private foundation effectively tax-exempt organizations to report other

other than an organization described in

controlled (directly or indirectly) by the additional taxes including the additional

sections 509(a)(1) through (4).

same persons who control the private tax figured in Part IV of Form 8621,

foundation in question, or Return by a Shareholder of a Passive

In general, churches, hospitals,

ii. A private foundation to which Foreign Investment Company or Qualified

schools, and broadly publicly supported

substantially all contributions were made Electing Fund.

organizations are excluded from private

(directly or indirectly) by one or more of

foundation status by these sections.

Form 990-W, Estimated Tax on

the persons described in a, b, and c

These organizations may be required to

Unrelated Business Taxable Income

above, or members of their families,

file Form 990 or Form 990-EZ instead of

for Tax-Exempt Organizations (and on

within the meaning of section 4946(d).

Form 990-PF.

Investment Income for Private

2. A nonexempt charitable trust

8. An organization is controlled by a

Foundations). Use of this form is

treated as a private foundation is a trust

foundation or by one or more disqualified

optional. It is provided only to aid you in

that is not exempt from tax under section

persons with respect to the foundation if

determining your tax liability.

501(a) and all of the unexpired interests

any of these persons may, by combining

Form 1041, U.S. Income Tax Return for

of which are devoted to religious,

their votes or positions of authority,

Estates and Trusts. Required of section

charitable, or other purposes described in

require the organization to make an

4947(a)(1) nonexempt charitable trusts

section 170(c)(2)(B), and for which a

expenditure or prevent the organization

that also file Form 990-PF. However, if

deduction was allowed under a section of

from making an expenditure, regardless

the trust does not have any taxable

the Code listed in section 4947(a)(1).

of the method of control. “Control” is

income under the income tax provisions

3. A taxable private foundation is an

determined regardless of how the

(subtitle A of the Code), it may use the

organization that is no longer exempt

foundation requires the contribution to be

filing of Form 990-PF to satisfy its Form

under section 501(a) as an organization

used.

1041 filing requirement under section

described in section 501(c)(3). Though it

6012. If this condition is met, check the

may operate as a taxable entity, it will

D. Other Forms You May

box for question 15, Part VII-A, of Form

continue to be treated as a private

990-PF and do not file Form 1041.

foundation until that status is terminated

Need To File

under section 507.

Form 1041-ES, Estimated Income Tax

•

Form W-2, Wage and Tax Statement.

4. A private operating foundation is an

for Estates and Trusts. Used to make

•

Form W-3, Transmittal of Wage and

organization that is described under

estimated tax payments.

Tax Statements.

section 4942(j)(3) or (5). It means any

•

Form 940, Employer’s Annual Federal

Form 1096, Annual Summary and

private foundation that spends at least

Unemployment (FUTA) Tax Return.

Transmittal of U.S. Information

85% of the smaller of its adjusted net

•

Form 941, Employer’s Quarterly

Returns. Used to transmit Forms 1099,

income (figured in Part I) or its minimum

Federal Tax Return.

1098, 5498, and W-2G to the IRS. Do not

investment return (figured in Part X)

These forms are used to report social

use it to transmit electronically.

directly for the active conduct of the

security, Medicare, and income taxes

exempt purpose or functions for which the

Form 1098-C, Contributions of Motor

withheld by an employer and social

foundation is organized and operated and

Vehicles, Boats, and Airplanes.

security and Medicare taxes paid by an

that also meets the assets test, the

Information return for reporting

employer.

endowment test, or the support test

contributions of qualified motor vehicles,

(discussed in Part XIV).

If income, social security, and

boats, and airplanes from donors.

5. A nonoperating private foundation

Medicare taxes that must be withheld are

Forms 1099-INT, MISC, OID, and R.

is a private foundation that is not a private

not withheld or are not paid to the IRS, a

Information returns for reporting certain

operating foundation.

trust fund recovery penalty may apply.

interest; miscellaneous income (for

6. A foundation manager is an officer,

The penalty is 100% of such unpaid

example, payments to providers of health

director, or trustee of a foundation, or an

taxes.

and medical services, miscellaneous

individual who has powers similar to

This penalty may be imposed on all

income payments, and nonemployee

those of officers, directors, or trustees. In

persons (including volunteers, see below)

compensation); original issue discount;

the case of any act or failure to act, the

whom the IRS determines to be

and distributions from retirement or

term “foundation manager” may also

responsible for collecting, accounting for,

profit-sharing plans, IRAs, SEPs or

include employees of the foundation who

and paying over these taxes, and who

SIMPLEs, and insurance contracts.

have the authority to act.

willfully did not do so.

7. A disqualified person is any of the

Form 1120, U.S. Corporation Income

This penalty does not apply to any

following:

Tax Return. Filed by nonexempt taxable

volunteer, unpaid member of any board of

a. A substantial contributor (see

private foundations that have taxable

trustees or directors of a tax-exempt

instructions for Part VII-A, line 10, on

income under the income tax provisions

organization, if this member:

page 19).

(subtitle A of the Code). Form 990-PF is

•

Is solely serving in an honorary

b. A foundation manager.

also filed by these taxable foundations.

capacity,

c. A person who owns more than 20%

Form 1120-POL, U.S. Income Tax

•

Does not participate in the day-to-day

of a corporation, partnership, trust, or

Return for Certain Political

or financial activities of the organization,

unincorporated enterprise that is itself a

Organizations. Section 501(c)

and

substantial contributor.

organizations must file Form 1120-POL if

•

Does not have actual knowledge of the

d. A family member of an individual

they are treated as having political

failure to collect, account for, and pay

described in a, b, or c above.

organization taxable income under

over these taxes.

e. A corporation, partnership, trust, or

section 527(f)(1).

However, this exception does not apply if

estate in which persons described in a, b,

it results in no person being liable for the

c, or d above own a total beneficial

Form 1128, Application To Adopt,

penalty.

interest of more than 35%.

Change, or Retain a Tax Year. Form

f. For purposes of section 4941 Form 990-T, Exempt Organization 1128 is used to request approval from the

(self-dealing), a disqualified person also Business Income Tax Return. Every IRS to change a tax year or to adopt or

includes certain government officials. organization exempt from income tax retain a certain tax year.

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Form 990-PF Instructions

Page 4 of 32 Instructions for Form 990-PF 13:37 - 29-NOV-2010

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Form 2220, Underpayment of

8275-R below) that are not otherwise

•

Pub. 3833, Disaster Relief, Providing

Estimated Tax by Corporations. Form

adequately disclosed on the tax return. Assistance Through Charitable

2220 is used by corporations and trusts

The disclosure is made to avoid parts of Organizations.

filing Form 990-PF to see if the foundation

the accuracy-related penalty imposed for

owes a penalty and to figure the amount

disregard of rules or substantial Publications and forms are available at no

of the penalty. Generally, the foundation

understatement of tax. Form 8275 is also charge through IRS offices or by calling

is not required to file this form because

used for disclosures relating to preparer 1-800-TAX-FORM (1-800-829-3676).

the IRS can figure the amount of any

penalties for understatements due to

penalty and bill the foundation for it.

unrealistic positions or for willful or

F. Use of Form 990-PF To

However, complete and attach Form 2220

reckless conduct.

Satisfy State Reporting

even if the foundation does not owe the

Form 8275-R, Regulation Disclosure

penalty if:

Statement. Use this form to disclose any

Requirements

•

The annualized income or the adjusted

item on a tax return for which a position

Some states and local government units

seasonal installment method is used, or

has been taken that is contrary to

will accept a copy of Form 990-PF and

•

The foundation is a “large

Treasury regulations.

required attachments instead of all or part

organization,” (see General Instruction O)

of their own financial report forms.

Form 8300, Report of Cash Payments

computing its first required installment

Over $10,000 Received in a Trade or

based on the prior year’s tax.

If the organization plans to use Form

Business. Used to report cash amounts

If Form 2220 is attached, check the box

990-PF to satisfy state or local filing

in excess of $10,000 received in a single

on Form 990-PF, page 4, Part VI, line 8

requirements, such as those from state

transaction (or in two or more related

and enter the amount of any penalty on

charitable solicitation acts, note the

transactions) in the course of a trade or

this line.

following.

business (as defined in section 162).

Form 4506, Request for Copy of Tax

Determine state filing requirements.

Form 8822, Change of Address. Used

Return. Used by the organization or

Consult the appropriate officials of all

by taxpayers to notify the IRS of changes

designated third party to get a complete

states and other jurisdictions in which the

in individual and business mailing

copy of the organization’s return.

organization does business to determine

addresses.

their specific filing requirements. “Doing

Form 4506-A, Request for Public

Form 8886-T, Disclosure by

business” in a jurisdiction may include

Inspection or Copy of Exempt or

Tax-Exempt Entity Regarding

any of the following:

Political Organization IRS Form. Used

Prohibited Tax Shelter Transaction.

•

Soliciting contributions or grants by

to inspect or request a copy of an exempt

Used by an exempt organization to

mail or otherwise from individuals,

or political organization’s return, report,

disclose whether it was a party to a

businesses, or other charitable

notice, or exemption application by the

prohibited tax shelter transaction.

organizations;

public or the organization.

•

Conducting programs;

Form 8868, Application for Extension

Form 4720, Return of Certain Excise

•

Having employees within that

of Time To File an Exempt

Taxes Under Chapters 41 and 42 of the

jurisdiction; or

Organization Return. Used by an

Internal Revenue Code. Is primarily

•

Maintaining a checking account or

exempt organization to request an

used to determine the excise taxes

owning or renting property there.

automatic 3-month extension of time to

imposed on:

file its return and also to apply for an

Monetary tests may differ. Some or all

•

Acts of self-dealing between private

additional (not automatic) 3-month

of the dollar limitations that apply to Form

foundations and disqualified persons,

extension if necessary.

990-PF when filed with the IRS may not

•

Failure to distribute income,

apply when using Form 990-PF instead of

•

Excess business holdings,

Form 8870, Information Return for

state or local report forms. IRS dollar

•

Investments that jeopardize the

Transfers Associated With Certain

limitations that may not meet some state

foundation’s charitable purposes,

Personal Benefit Contracts. Used to

requirements are the $5,000 total assets

•

Making political or other noncharitable

identify those personal benefit contracts

minimum that requires completion of Part

expenditures, and

for which funds were transferred to the

II, column (c), and Part XV; and the

•

Prohibited tax shelter transactions.

organization, directly or indirectly, as well

$50,000 minimum for listing the highest

as the transferors and beneficiaries of

Form 5500, Annual Return/Report of

paid employees and for listing

those contracts.

Employee Benefit Plan. Is used to

professional fees in Part VIII.

Form 8899, Notice of Income from

report information concerning employee

Additional information may be

Donated Intellectual Property. Used to

benefit plans and Direct Filing Entities.

required. State and local filing

report income from qualified intellectual

Form 8282, Donee Information Return.

requirements may require attaching to

property.

Required of the donee of “charitable

Form 990-PF one or more of the

Form 8921, Applicable Insurance

deduction property” that sells, exchanges,

following:

Contracts Information Return. Used by

or otherwise disposes of the property

•

Additional financial statements, such as

an exempt organization to report its direct

within 3 years after the date it received

a complete analysis of functional

or indirect acquisition of certain insurance

the property. Also required of any

expenses or a statement of changes in

contracts.

successor donee that disposes of

net assets;

charitable deduction property within 3

•

Notes to financial statements;

years after the date the donor gave the

E. Useful Publications

•

Additional financial schedules;

property to the original donee. It does not

The following publications may be helpful

•

A report on the financial statements by

matter who gave the property to the

in preparing Form 990-PF:

an independent accountant; and

successor donee. It may have been the

•

Pub. 525, Taxable and Nontaxable

•

Answers to additional questions and

original donee or another successor

Income,

other information.

donee. For successor donees, the form

•

Pub. 583, Starting a Business and

Each jurisdiction may require the

must be filed only for any property that

Keeping Records,

additional material to be presented on

was transferred by the original donee

•

Pub. 598, Tax on Unrelated Business

forms they provide. The additional

after July 5, 1988.

Income of Exempt Organizations,

material does not have to be submitted

Form 8275, Disclosure Statement.

•

Pub. 910, IRS Guide to Free Tax

with the Form 990-PF filed with the IRS.

Taxpayers and tax return preparers Services,

should attach this form to Form 990-PF to

•

Pub. 1771, Charitable If required information is not provided

disclose items or positions (except those Contributions—Substantiation and to a state, the organization may be asked

contrary to a regulation—see Form Disclosure Requirements, and by the state to provide it or to submit an

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Form 990-PF Instructions

Page 5 of 32 Instructions for Form 990-PF 13:37 - 29-NOV-2010

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

amended return even if the Form 990-PF The return must be filed on the basis

•

DHL Express (DHL): DHL Same Day

is accepted by the IRS as complete. of the established annual accounting Service.

period of the organization. If the

•

Federal Express (FedEx): FedEx

Amended returns. If the organization

organization has no established Priority Overnight, FedEx Standard

submits supplemental information or files

accounting period, the return should be Overnight, FedEx 2Day, FedEx

an amended Form 990-PF with the IRS, it

on the calendar-year basis. International Priority, FedEx International

must also include a copy of the

First.

For initial or final returns or a change

information or amended return to any

•

United Parcel Service (UPS): UPS Next

in accounting period, the 2010 form may

state with which it filed a copy of Form

Day Air, UPS Next Day Air Saver, UPS

also be used as the return for a short

990-PF.

2nd Day Air, UPS 2nd Day Air AM, UPS

period (less than 12 months) ending

Method of accounting. Many states

Worldwide Express Plus, and UPS

November 30, 2011, or earlier.

require that all amounts be reported

Worldwide Express.

In general, to change its accounting

based on the accrual method of

The private delivery service can tell

period, the organization must file Form

accounting.

you how to get written proof of the mailing

990-PF by the due date for the short

Time for filing may differ. The time for

date.

period resulting from the change. At the

filing Form 990-PF with the IRS may differ

top of this short period return, write

from the time for filing state reports.

Electronic Filing

“Change of Accounting Period.”

The foundation can file its Form 990-PF

If the organization changed its

G. Furnishing Copies of

electronically. However, if the foundation

accounting period within the

files at least 250 returns during the

Form 990-PF to State

10-calendar-year period that includes the

calendar year, it must file Form 990-PF

beginning of the short period, and it had a

Officials

electronically. If the foundation must file a

Form 990-PF filing requirement at any

The foundation managers must furnish a

return electronically but does not, the

time during that 10-year period, it must

copy of Form 990-PF and Form 4720 (if

organization is considered to have not

also attach Form 1128 to the short-period

applicable) to the attorney general of:

filed its return. See Regulations section

return. See Rev. Proc. 85-58, 1985-2 C.B.

•

Each state required to be listed in Part

301.6033-4 for more information. For

740.

VII-A, line 8a;

additional information on the electronic

•

The state in which the foundation’s

filing requirement, visit www.irs.gov/efile.

I. Accounting Methods

principal office is located; and

Generally, you should report the financial

The IRS may waive the

•

The state in which the foundation was

information requested on the basis of the

requirements to file electronically

incorporated or created.

accounting method the foundation

in cases of undue hardship. For

TIP

A copy of the annual return must be

regularly uses to keep its books and

more information on filing a waiver, see

sent to the attorney general at the same

records.

Notice 2010-13, 2010-4 I.R.B. 327,

time the annual return is filed with the

available at http://www.irs.gov/irb/

Exception. Complete Part I, column (d)

IRS.

2010-04_IRB/ar14.html.

on the cash receipts and disbursements

Other requirements. If the attorney

method of accounting.

general or other appropriate state official

K. Extension of Time To

of any state requests a copy of the annual

J. When, Where, and How

File

return, the foundation managers must

A foundation uses Form 8868 to request

To File

comply with the request.

an extension of time to file its return.

Exceptions. These rules do not apply to

This return must be filed by the 15th day

any foreign foundation which, from the An automatic 3-month extension will

of the 5th month following the close of the

date of its creation, has received at least be granted if you properly complete this

foundation’s accounting period. If the

85% of its support (excluding gross form, file it, and pay any balance due by

regular due date falls on a Saturday,

investment income) from sources outside the due date for Form 990-PF.

Sunday, or legal holiday, file by the next

the United States. See General

If more time is needed, Form 8868 is

business day. If the return is filed late,

Instruction S for other exceptions that

also used to request an additional

see General Instruction M.

affect this type of organization.

extension of up to 3 months. However,

In case of a complete liquidation,

Coordination with state reporting

these extensions are not automatically

dissolution, or termination, file the return

requirements. If the foundation

granted. To obtain this additional

by the 15th day of the 5th month following

managers submit a copy of Form 990-PF

extension of time to file, you must show

complete liquidation, dissolution, or

and Form 4720 (if applicable) to a state

reasonable cause for the additional time

termination.

attorney general to satisfy a state

requested.

reporting requirement, they do not have to

To file the return, mail or deliver it to:

furnish a second copy to that attorney

L. Amended Return

Department of the Treasury

general to comply with the Internal

To change the organization’s return for

Internal Revenue Service Center

Revenue Code requirements discussed in

any year, file an amended return,

Ogden, UT 84201–0027

this section.

including attachments, with the correct

If the organization’s principal business,

If there is a state reporting requirement

information. The amended return must

office or agency is located in a foreign

to file a copy of Form 990-PF with a state

provide all the information required by the

country or U.S. possession, mail or

official other than the attorney general (for

form and instructions, not just the new or

deliver the return to:

instance, the secretary of state), then the

corrected information. Check “Amended

foundation managers must also send a

Return” in block G at the top of page 1.

Internal Revenue Service Center

copy of the Form 990-PF and Form 4720

See the instructions for Part VI, line 9, on

P.O. Box 409101

(if applicable) to the attorney general of

page 19.

Ogden, UT 84409

that state.

Private delivery services. You can use If the organization files an amended

certain private delivery services return to claim a refund of tax paid under

H. Accounting Period

designated by the IRS to meet the “timely section 4940 or 4948, it must file the

File the 2010 return for the calendar year mailing as timely filing/paying” rule for tax amended return within 3 years after the

2010 or fiscal year beginning in 2010. If returns and payments. These private date the original return was filed, or within

the return is for a fiscal year, fill in the tax delivery services include only the 2 years from the date the tax was paid,

year space at the top of the return. following. whichever date is later.

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Form 990-PF Instructions

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The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

State reporting requirements. See Most tax-exempt organizations, other apply the rules of Part VI to your tax year

Amended returns under General than churches, are required to file an 2011 estimated amounts for that part.

Instruction F. annual Form 990, 990-EZ, 990-PF, or Enter the tax you figured on line 10a of

990-N e-Postcard with the IRS. If an Form 990-W.

Need a copy of an old return or form?

organization fails to file an annual return

Use Form 4506 to obtain a copy of a

The Form 990-W line items and

or notice for three consecutive years, it

previously filed return. You can obtain

instructions for large organizations also

will automatically lose its tax-exempt

blank forms for prior years by calling

apply to private foundations. For

status. In 2011, automatic revocations will

1-800-TAX-FORM (1-800-829-3676).

purposes of paying the estimated tax on

start for organizations not filing for the

net investment income, a “large

third consecutive year. A private

M. Penalty for Failure To

organization” is one that had net

foundation that loses its exemption must

investment income of $1 million or more

File Timely, Completely, or

file income tax returns and pay income

for any of the 3 tax years immediately

taxes and must file Form 990-PF as a

Correctly

preceding the tax year involved.

taxable private foundation. For details, go

To avoid filing an incomplete return or

Penalty. A foundation that does not pay

to www.irs.gov/eo.

having to respond to requests for missing

the proper estimated tax when due may

information, see General Instruction B.

be subject to the estimated tax penalty for

N. Penalties for Not Paying

Against the organization. If an

the period of the underpayment. See

Tax on Time

organization does not file timely and

sections 6655(b) and (d) and the Form

completely, or does not furnish the correct

2220 instructions for further information.

There is a penalty for not paying tax when

information, it must pay $20 for each day

due (section 6651). The penalty generally

Special Rules

the failure continues ($100 a day if it is a

of 1% of the unpaid tax for each

large organization), unless it can show

month or part of a month the tax remains

Section 4947(a)(1) nonexempt

that the failure was due to reasonable

unpaid, not to exceed 25% of the unpaid

charitable trusts. Form 1041-ES should

cause. Those filing late (after the due

tax. If there was reasonable cause for not

be used to pay any estimated tax on

date, including extensions) must attach

paying the tax on time, the penalty can be

income subject to tax under section 1.

an explanation to the return. The

waived. However, interest is charged on

Form 1041-ES also contains the

maximum penalty for each return will not

any tax not paid on time, at the rate

estimated tax rules for paying the tax on

exceed the smaller of $10,000 ($50,000

provided by section 6621.

that income.

for a large organization) or 5% of the

Estimated tax penalty. The section

Taxable private foundations. Form

gross receipts of the organization for the

6655 penalty for failure to pay estimated

1120-W should be used to figure any

year.

tax applies to the tax on net investment

estimated tax on income subject to tax

Large organization. A large

income of domestic private foundations

under section 11. Form 1120-W contains

organization is one that has gross

and section 4947(a)(1) nonexempt

the estimated tax rules for paying the tax

receipts exceeding $1 million for the tax

charitable trusts. The penalty also applies

on that income.

year.

to any tax on unrelated business income

of a private foundation. Generally, if a

Gross receipts. Gross receipts

P. Tax Payment Methods

private foundation’s tax liability is $500 or

means the gross amount received during

more and it did not make the required

the foundation’s annual accounting period

for Domestic Private

payments on time, then it is subject to the

from all sources without reduction for any

Foundations

penalty.

costs or expenses.

Whether the foundation uses the

To figure the foundation’s gross

For more details, see the discussion

depository method of tax payment or the

receipts, complete the following:

of Form 2220 in General Instruction D.

special option for small foundations, it

1. Part I, line 12, column (a);

must pay the tax due (see Part VI) in full

2. Add lines 6b and 10b; and

O. Figuring and Paying

by the 15th day of the 5th month after the

3. Subtract line 6a.

end of its tax year.

Estimated Tax

Against the responsible person. The

A domestic exempt private foundation, a

IRS will make written demand that the

domestic taxable private foundation, or a

Electronic Deposit Requirement

delinquent return be filed or the

nonexempt charitable trust treated as a

information furnished within a reasonable

The IRS has issued proposed regulations

private foundation must make estimated

time after the mailing of the notice of the

under section 6302 which provide that

tax payments for the excise tax based on

demand. The person failing to comply

beginning January 1, 2011, the

investment income if it can expect its

with the demand on or before the date

foundation must deposit all depository

estimated tax (section 4940 tax minus

specified will have to pay $10 for each

taxes (such as employment tax, excise

allowable credits) to be $500 or more.

day the failure continues, unless there is

tax, and corporate income tax)

The number of installment payments it

reasonable cause. The maximum penalty

electronically using the Electronic Federal

must make under the depository method

imposed on all persons for any one return

Tax Payment System (EFTPS). Under

is determined at the time during the year

is $5,000. If more than one person is

these proposed regulations, which are

that it first meets this requirement. For

liable for any failures, all such persons

expected to be finalized by December 31,

calendar-year taxpayers, the first deposit

are jointly and severally liable for such

2010, Forms 8109 and 8109-B, Federal

of estimated taxes for a year generally

failures. See section 6652(c) for further

Tax Deposit Coupon, cannot be used

should be made by May 15 of the year.

information.

after December 31, 2010. For more

information about EFTPS or to enroll in

Although Form 990-W is used primarily

Other penalties. Because this return

EFTPS, visit the EFTPS website at www.

to compute the installment payments of

also satisfies the filing requirements of a

eftps.gov, or call 1-800-555-4477. You

unrelated business income tax, it is also

tax return under section 6011 for the tax

can also get Pub. 966, The Secure Way

used to determine the timing and

on investment income imposed by section

to Pay Your Federal Taxes. See below for

amounts of installment payments of the

4940 (or 4948 if an exempt foreign

an exception to this rule for small

section 4940 tax based on investment

organization), the penalties imposed by

foundations

income. Compute separately any required

section 6651 for not filing a return (without

deposits of excise tax based on

reasonable cause) also apply.

Depositing on time. For deposits made

investment income and unrelated

There are also criminal penalties for by EFTPS to be on time, the foundation

business income tax.

willful failure to file and for filing fraudulent must initiate the transaction at least 1

returns and statements. See sections To figure the estimated tax for the business day before the date the deposit

7203, 7206, and 7207. excise tax based on investment income, is due.

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•

Any material that is not available for reasonable location of its choice. It must

Special Payment Option for

public inspection under section 6104. permit public inspection:

Small Foundations

•

Within a reasonable amount of time

A private foundation may enclose a check

Who Must Make the Annual

after receiving a request for inspection

or money order, payable to the United

Returns and Exemption

(normally, not more than 2 weeks), and

States Treasury, with the Form 990-PF or

•

At a reasonable time of day.

Application Available for Public

Form 8868, if it meets all of the following

Inspection?

Optional method of complying. If a

requirements:

private foundation that does not have a

The foundation’s Form 990-PF, 990-T,

1. The foundation must not be

permanent office wishes not to allow an

and exemption application must be made

required to use EFTPS,

inspection by office visitation, it may mail

available to the public by the foundation

2. The tax based on investment

a copy of the requested documents

and the IRS.

income shown on line 5, Part VI of Form

instead of allowing an inspection.

990-PF is less than $500, and

How Does a Private Foundation

However, it must mail the documents

3. If Form 8868 is used, the amount

within 2 weeks of receiving the request

Make Its Annual Returns and

entered on line 3a of Part I or line 8a of

and may charge for copying and postage

Exemption Application

Part II of Form 8868 must be less than

only if the requester consents to the

Available for Public Inspection?

$500 and it must be the full balance due.

charge.

A private foundation must make its annual

Private foundations with a

Be sure to write “2010 Form 990-PF”

returns and exemption application

permanent office but limited or no

and the foundation’s name, address, and

available in two ways:

hours. Even if a private foundation has a

EIN on its check or money order.

•

By office visitation, and

permanent office but no office hours or

•

By providing copies or making them

very limited hours during certain times of

Foreign organizations should see

widely available.

the year, it must still meet the office

the instructions for Part VI, line 9.

visitation requirement. To meet this

Public Inspection by Office

CAUTION

requirement during those periods when

Visitation

office hours are limited or not available,

A private foundation must make its annual

Q. Public Inspection

follow the rules above under What if the

returns and exemption application

private foundation does not maintain a

Requirements

available for public inspection without

permanent office?

A private foundation must make its annual

charge at its principal, regional, and

returns and exemption application

district offices during regular business

Public Inspection—Providing

available for public inspection.

hours.

Copies

Conditions that may be set for public

A private foundation must provide copies

Because Form 990-PF is

inspection at the office. A private

of its annual returns or exemption

disclosed to the public, do not

foundation:

application to any individual who makes a

report personal information about

CAUTION

•

May have an employee present,

request for a copy in person or in writing

grantees or others that is not required and

•

Must allow the individual conducting

unless it makes these documents widely

could be used for identity theft purposes,

the inspection to take notes freely during

available.

such as a social security number or bank

the inspection, and

account information.

In-person requests for document

•

Must allow an individual to make

copies. A private foundation must

photocopies of documents at no charge

Definitions

provide copies to any individual who

but only if the individual brings

makes a request in person at the private

Annual returns. Annual returns include

photocopying equipment to the place of

foundation’s principal, regional, or district

an exact copy of the following documents

inspection.

offices during regular business hours on

as filed with the IRS.

the same day that the individual makes

Determining if a site is a regional or

•

Form 990-PF, including all schedules,

the request.

district office. A regional or district

attachments, and supporting documents,

office is any office of a private foundation,

Accepted delay in fulfilling an

and any amended return that is 3 or fewer

other than its principal office, that has

in-person request. If unusual

years old from:

paid employees whose total number of

circumstances exist and fulfilling a

1. The date the original return was

paid hours a week are normally 120 hours

request on the same day places an

filed or required to be filed, or

or more. Include the hours worked by

unreasonable burden on the private

2. The date the return was required to

part-time (as well as full-time) employees

foundation, it must provide copies by the

be filed.

in making that determination.

earlier of:

•

Form 990-T, if it was used to report any

•

The next business day following the

What sites are not considered a

tax on unrelated business income.

day that the unusual circumstances end,

regional or district office. A site is not

Exemption application. An application

considered a regional or district office if:

for tax exemption includes (except as

•

The fifth business day after the date of

1. The only services provided at the

described later):

the request.

site further the foundation’s exempt

•

Any prescribed application form (such

Examples of unusual circumstances

purposes (for example, day care, health

as Form 1023 or Form 1024),

include:

care, or scientific or medical research),

•

All documents and statements the IRS

•

Receipt of a volume of requests (for

and

requires an applicant to file with the form,

document copies) that exceeds the

2. The site does not serve as an office

•

Any statement or other supporting

private foundation’s daily capacity to

for management staff, other than

document submitted in support of the

make copies,

managers who are involved only in

application, and

•

Requests received shortly before the

managing the exempt function activities at

•

Any letter or other document issued by

end of regular business hours that require

the site.

the IRS concerning the application.

an extensive amount of copying, or

An application for tax exemption does What if the private foundation does not

•

Requests received on a day when the

not include: maintain a permanent office? If the organization’s managerial staff capable of

•

Any application for tax exemption filed private foundation does not maintain a fulfilling the request is conducting official

before July 15, 1987, unless the private permanent office, it will comply with the duties (for instance, student registration

foundation filing the application had a public inspection by office visitation or attending an off-site meeting or

copy of the application on July 15, 1987, requirement by making the annual returns convention) instead of its regular

or and exemption application available at a administrative duties.

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Use of local agents for providing Requests for parts of a document

comply with any request for copies that it

copies. A private foundation may use a copy. A person can request all or any

reasonably believes is part of the

local agent to handle in-person requests specific part or schedule of the annual

harassment campaign.

for document copies. If a private returns or exemption application, and the

A group of requests for a private

foundation uses a local agent, it must private foundation must fulfill their request

foundation’s annual returns or exemption

immediately provide the local agent’s for a copy.

application is indicative of a harassment

name, address, and telephone number to

Can an agent be used to provide

campaign if the requests are part of a

the requester.

copies? A private foundation can use an

single coordinated effort to disrupt the

agent to provide document copies for the

operations of the private foundation rather

The local agent must:

written requests it receives. However, the

than to collect information about it.

•

Be located within reasonable proximity

agent must provide the document copies

to the principal, regional, or district office

See Regulations section

under the same conditions imposed on

where the individual makes the request;

301.6104(d)-3 for more information.

the private foundation itself. Also, if an

and

agent fails to provide the documents as

Requests that may be disregarded

•

Provide document copies within the

required, the private foundation will

without IRS approval. A private

same time frames as the private

continue to be subject to penalties.

foundation may disregard any request for

foundation.

copies of all or part of any document

Example. The ABC Foundation

Written requests for document copies.

beyond the first two received within any

retained an agent to provide copies for all

If a private foundation receives a written

30-day period or the first four received

written requests for documents. However,

request for a copy of its annual returns or

within any 1-year period from the same

ABC Foundation received a request for

exemption application (or parts of these

individual or the same address.

document copies before the agent did.

documents), it must give a copy to the

The deadline for providing a response

Making the Annual Returns and

requester. However, this rule only applies

is referenced by the date the ABC

if the request:

Exemption Application Widely

Foundation received the request and not

•

Is addressed to a private foundation’s

Available

when the agent received it. If the agent

principal, regional, or district office;

A private foundation does not have to

received the request first, then a

•

Is delivered to that address by mail,

provide copies of its annual returns and/or

response would be referenced to the date

electronic mail (email), facsimile (fax), or

its exemption application if it makes these

the agent received it.

a private delivery service approved by the

documents widely available. However, it

Can a fee be charged for providing

IRS (see Private delivery services on

must still allow public inspection by office

copies? A private foundation may

page 5 for a list); and

visitation.

charge a reasonable fee for providing

•

Gives the address to which the

How does a private foundation make

copies. Also, it can require the fee to be

document copies should be sent.

its annual returns and exemption

paid before providing a copy of the

How and when a written request is

application widely available? A private

requested document.

fulfilled. Requested document copies

foundation’s annual returns and/or

What is a reasonable fee? A fee is

must be mailed within 30 days from the

exemption application is widely available

reasonable only if it is no more than the

date the private foundation receives the

if it meets all four of the following

per-page copying fee charged by the IRS

request.

requirements:

for providing copies, plus no more than

1. Internet posting requirement—

Unless other evidence exists, a mailed

the actual postage costs incurred to

This is met if:

request or payment is considered to be

provide the copies.

•

The document is posted on a World

received by the private foundation 7 days

What forms of payment must the

Wide Web page that the private

after the postmark date.

private foundation accept? The form of

foundation establishes and maintains, or

payment depends on whether the request

If an advance payment is required,

•

The document is posted as part of a

for copies is made in person or in writing.

copies must be provided within 30 days

database of like documents of other

Cash and money order must be

from the date payment is received.

tax-exempt organizations on a World

accepted for in-person requests for

Wide Web page established and

If the private foundation requires

document copies. The private foundation,

maintained by another entity.

payment in advance and it receives a

if it wishes, may accept additional forms

2. Additional posting information

request without payment or with

of payment.

requirement—This is met if:

insufficient payment, it must notify the

Certified check, money order, and

•

The World Wide Web page through

requester of the prepayment policy and

either personal check or credit card must

which the document is available clearly

the amount due within 7 days from the

be accepted for written requests for

informs readers that the document is

date it receives the request.

document copies. The private foundation,

available and provides instructions for

A request that is transmitted to the

if it wishes, may accept additional forms

downloading the document;

private foundation by email or fax is

of payment.

•

After it is downloaded and viewed,

considered received the day the request

the web document exactly reproduces the

Other fee information. If a private

is transmitted successfully.

image of the annual returns or exemption

foundation provides a requester with

application as it was originally filed with

notice of a fee and the requester does not

Requested documents can be emailed

the IRS, except for any information

pay the fee within 30 days, it may ignore

instead of the traditional method of

permitted by statute to be withheld from

the request.

mailing if the requester consents to this

public disclosure; and

method.

If a requester’s check does not clear

•

Any individual with access to the

on deposit, it may ignore the request.

A document copy is considered as Internet can access, download, view, and

If a private foundation does not require

provided on the: print the document without special

prepayment and the requester does not

•

Postmark date, computer hardware or software required

prepay, the private foundation must

•

Private delivery date, for that format (except software that is

receive consent from the requester if the

•

Registration date for certified or readily available to members of the public

copying and postage charge

registered mail, without payment of any fee) and without

exceeds $20.

•

Postmark date on the sender’s receipt payment of a fee to the private foundation

for certified or registered mail, or Private foundations subject to a or to another entity maintaining the web

•

Day the email is successfully harassment campaign. If the IRS page.

transmitted (if the requester agreed to this determines that a private foundation is 3. Reliability and accuracy

method). being harassed, it is not required to requirements—To meet this, the entity

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maintaining the World Wide Web page are subject to income tax under subtitle A

R. Disclosures Regarding

of the Code.

must:

Certain Information and

•

Have procedures for ensuring the

For these purposes, U.S. territories are

reliability and accuracy of the document

considered part of the United States. As a

Services Furnished

that it posts on the page;

result, territories’ organizations are not

A section 501(c) organization that offers

considered foreign organizations.

•

Take reasonable precautions to

to sell or solicits money for specific

prevent alteration, destruction, or

information or a routine service to any

accidental loss of the document when

T. Liquidation, Dissolution,

individual that could be obtained by the

posted on its page; and

individual from a Federal Government

Termination, or

•

Correct or replace the document if a

agency free or for a nominal charge must

posted document is altered, destroyed, or

disclose that fact conspicuously when

Substantial Contraction

lost.

making such offer or solicitation.

If there is a liquidation, dissolution,

4. Notice requirement—To meet this,

Any organization that intentionally termination, or substantial contraction

a private foundation must notify any

disregards this requirement will be subject (defined below) of the organization, attach

individual requesting a copy of its annual

to a penalty for each day the offers or the following to the filing.

returns and/or exemption application

solicitations are made. The penalty is the

•

A statement to the return

where the documents are available

greater of $1,000 or 50% of the total cost explaining it.

(including the Internet address). If the

of the offers and solicitations made on

•

A certified copy of the liquidation plan,

request is made in person, the private that day. resolution, etc. (if any) and all

amendments or supplements that were

foundation must notify the individual

not previously filed.

immediately. If the request is in writing, it

S. Organizations

•

A schedule that lists the names and

must notify the individual within 7 days of

Organized or Created in a

addresses of all recipients of assets.

receiving the request.

•

An explanation of the nature and fair

Foreign Country

market value of the assets distributed to

If an organization applies any provision of

Penalties

each recipient.

any U.S. tax treaty to compute the

A penalty may be imposed on any person

Additional requirements. For a

foundation’s taxable income, tax liability,

who does not make the annual returns

complete corporate liquidation or trust

or tax credits in a manner different from

(including all required attachments to

termination, attach a statement as to

these instructions, attach an explanation.

each return) or the exemption application

whether a final distribution of assets was

Section 4948(a) imposes a 4% tax on

available for public inspection according

made and the date it was made (if

the gross investment income (but not

to the section 6104(d) rules discussed

applicable).

capital gain net income) of an exempt

above. If more than one person fails to

Also, an organization must indicate:

foreign private foundation from U.S.

comply, each person is jointly and

•

That it has ceased to exist and check

sources, such as dividends, interest,

severally liable for the full amount of the

Final return in block G of the Entity

rents, payments received on securities

penalty. The penalty amount is $20 for

section on page 1 of the return, or

loans as defined in section 512(a)(5), and

each day during which a failure occurs.

•

That it is terminating its private

royalties. Amounts taken into income on

The maximum penalty that may be

foundation status under section

Form 990-T are excepted. The section

imposed on all persons for any one

507(b)(1)(B), according to General

4948(a) tax replaces the section 4940 tax

annual return is $10,000. There is no

Instructions U and V, or

on the net investment income of a

maximum penalty amount for failure to

•

That it is voluntarily terminating its

domestic private foundation. To pay any

make the exemption application available

private foundation status under section

tax due, see the instructions for Part VI,

for public inspection.

507(a)(1) and owes a termination tax and

line 9. A foreign foundation does not

send the notice (and tax payment, if

complete Form 990-PF, Parts IV and V.

Any person who willfully fails to comply

applicable) required by Rev. Rul.

Under section 4948(b), sections 507,

with the section 6104(d) public inspection

2003-13, 2003-4 I.R.B. 305, and Rev.

508, and chapter 42 (other than section

requirements is subject to an additional

Rul. 2002-28, 2002-20, I.R.B. 941

4948) do not apply to a foreign

penalty of $5,000.

(2002-1 C.B., 941) to the Manager,

organization that from the date of its

Exempt Organizations Determinations, at

creation has received at least 85% of its

Requirements Placed on the

the address given in General Instruction

support (as defined in section 509(d),

IRS

excluding gross investment income) from

A private foundation’s Form 990-PF,

sources outside the United States. The

Relief from public inspection

990-T, and approved exemption

foreign foundation’s 501(c)(3) status can

requirements. If the organization has

application may be inspected by the

be revoked, however, if it commits a

terminated its private foundation status

public at an IRS office for your area or at

violation of chapter 42 (other than section

under section 507(b)(1)(A), it does not

the IRS National Office in Washington,

4942) after receiving a warning of a

have to comply with the notice and public

DC.

violation from the IRS, or if it commits a

inspection requirements of the return for

willful and flagrant violation. A foreign

the termination year.

To request a copy or to inspect a Form

foundation described in section 4948(b)

Filing date. See General Instruction J

990-PF, 990-T, or an approved exemption

does not complete Form 990-PF, Parts X

for the filing date.

application, complete Form 4506-A.

(unless claiming status as an operating

Definitions. The term substantial

Generally, there is a charge for

foundation), XI, XIII, and XV; is not

contraction includes any partial liquidation

photocopying.

required to send a copy of its annual

or any other significant disposition of

return to a state official; and is not

Also, the IRS can provide a complete

assets. However, this does not include

required to comply with the public

set of Forms 990-PF filed for a year on

transfers for full and adequate

inspection requirements for annual

CD and/or DVD. A partial set of Forms

consideration or distributions of current

returns (see General Instructions G and

990-PF filed by state or by month is also

income.

Q). The foundation must attach a

available. Call 1-877-829-5500 or write to

computation of the 85% test to the return.

A significant disposition of assets does

the address below for details.

not include any disposition for a tax year

Taxable foreign private foundations

if:

Internal Revenue Service

are foreign section 4947(a)(1) nonexempt

RAIVS Unit MS:6716

charitable trusts are not subject to excise 1. The total of the dispositions for the

Ogden, UT 84201

tax under sections 4948(a) or 4940, but tax year is less than 25% of the fair

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market value of the net assets of the that the organization did not terminate its use attachments that are the same size

organization at the beginning of the tax private foundation status. Interest on any as the printed forms.

year, and tax due will be charged from the original

On each attachment, write:

2. The total of the related dispositions due date of Form 990-PF, but penalties

•

“Form 990-PF,”

made during prior tax years (if a under sections 6651 and 6652 will not be

•

The tax year,

disposition is part of a series of related assessed if Form 990-PF is filed within

•

The corresponding schedule number or

dispositions made during these prior tax the period allowed by the IRS.

letter,

years) is less than 25% of the fair market

•

The organization’s name and EIN, and

value of the net assets of the organization

V. Special Rules for

•

The information requested using the

at the beginning of the tax year in which

format and line sequence of the printed

Section 507(b)(1)(B)

any of the series of related dispositions

form.

was made.

Also, show totals on the printed forms.

Termination

If the organization is terminating its

The facts and circumstances of the

private foundation status under the

particular case will determine whether a

60-month provisions of section

significant disposition has occurred

Specific Instructions

507(b)(1)(B), special rules apply. See

through a series of related dispositions.

General Instructions T and U. Under

Ordinarily, a distribution described in

Completing the Heading

these rules, the organization may file

section 170(b)(1)(F)(ii) (relating to private

Form 990-PF without paying the tax

The following instructions are keyed to

foundations making qualifying

based on investment income if it filed a

items in the Form 990-PF Entity section.

distributions out of corpus equal to 100%

consent under section 6501(c)(4) with its

of contributions received during the

Name and Address

notification to the TE/GE Customer

foundation’s tax year) will not be taken

Account Services at the Cincinnati

If the organization operates under a name

into account as a significant disposition of

address given in General Instruction U of

different from its legal name, give the

assets. See Regulations section

its intention to begin a section

legal name of the organization but identify

1.170A-9(h)(2).

507(b)(1)(B) termination. The consent

its alternate name, after the legal name,

provides that the period of limitation on

by writing “aka”(also known as) and the

U. Filing Requirements

the assessment of tax under Chapter 42,

alternate name of the organization. The

During Section

based on investment income for any tax

address used must be that of the principal

year in the 60-month period, will not

office of the foundation.

507(b)(1)(B) Termination

expire until at least 1 year after the period

Include the suite, room, or other unit

Although an organization terminating its

for assessing a deficiency for the last tax

number after the street address. If the

private foundation status under section

year in which the 60-month period would

post office does not deliver mail to the

507(b)(1)(B) may be regarded as a public

normally expire. Any foundation not

street address and the organization has a

charity for certain purposes, it is

paying the tax when it files Form 990-PF

P.O. box, show the box number instead of

considered a private foundation for filing

must attach a copy of the signed consent.

the street address.

requirement purposes and must file an

If the foundation did not file the

annual return on Form 990-PF. The return

Item A. Employer Identification

consent, the tax must be paid in the

must be filed for each year in the

Number

normal manner as explained in General

60-month termination period, if that period

Instructions O and P. The organization The organization should have only one

has not expired before the due date of the

may file a claim for refund after employer identification number (EIN). If it

return.

completing termination or during the has more than one EIN, notify the Internal

Regulations under section 507(b)(1)

termination period. The claim for refund Revenue Service Center at the address

(B)(iii) specify that within 90 days after the

must be filed on time and the organization shown under General Instruction J.

end of the termination period the

must supply information establishing that Explain what numbers the organization

organization must supply information to

it qualified as a public charity for the has, the name and address to which each

the IRS establishing that it has terminated

period for which it paid the tax. number was assigned, and the address of

its private foundation status and, as a

the organization’s principal office. The

result, qualifies as a public charity. Send

IRS will then advise which number to use.

W. Rounding, Currency,

the information to:

Item B. Telephone Number

and Attachments

Internal Revenue Service

Enter a foundation telephone number

TE/GE–EO Determinations

Rounding off to whole dollars. You

(including the area code) that the public

P.O. Box 2508

may round off cents to whole dollars on

and government regulators may use to

Cincinnati, OH 45201

your return and schedules. If you do

obtain information about the foundation’s

round to whole dollars, you must round all

If information is furnished establishing

finances and activities. This information

amounts. To round, drop amounts under

a successful termination, then, for the

should be available at this telephone

50 cents and increase amounts from 50

final year of the termination period, the

number during normal business hours. If

to 99 cents to the next dollar. For

organization should comply with the filing

the foundation does not have a

example, $1.39 becomes $1 and $2.50

requirements for the type of public charity

telephone, enter a telephone number of a

becomes $3.

it has become. See the Instructions for

foundation official who can provide this

Form 990 and Schedule A (Form 990 or

If you have to add two or more

information during normal business hours.

990-EZ) for details on filing requirements.

amounts to figure the amount to enter on

This applies even if the IRS has not

Item D2. Foreign Organizations

a line, include cents when adding the

confirmed that the organization has

If the foreign organization meets the 85%

amounts and round off only the total.

terminated its private foundation status by

test of Regulations section 53.4948-1(b),

Currency and language requirements.

the time the return for the final year of the

then:

Report all amounts in U.S. dollars. State

termination is due (or would be due if a

•

Check the box in D2 on page 1 of Form

the conversion rate used. Report all items

return were required).

990-PF,

in total, including amounts from both U.S.

The organization will be allowed a

•

Check the box at the top of Part XI,

and non-U.S. sources. All information

reasonable period of time to file any

•

Do not fill in Parts XI and XIII,

must be in English.

private foundation returns required (for

•

Do not fill in Part X unless it is claiming

the last year of the termination period) but Attachments. Use the schedules on status as a private operating foundation,

not previously filed if it is later determined Form 990-PF. If you need more space, and

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•

Attach the computation of the 85% test The amounts entered in column (a) 990-T. Income from debt-financed

to Form 990-PF. and on line 5b must be analyzed in Part property that is not taxed under section

XVI-A. 511 is taxed under section 4940. Thus, if

Note. In addition to these requirements,

the debt/basis percentage of a

foreign organizations checking the box in

Column (a). Revenue and

debt-financed property is 80%, only 80%

D1 of the Form do not complete Part IV or

Expenses per Books

of the gross income (and expenses) for

Part I, line 7. See General Instruction B

Enter in column (a) all items of revenue

that property is used to figure the section

for more details.

and expense shown in the books and

511 tax on Form 990-T. The remaining

records that increased or decreased the

Item E. Section 507(b)(1)(A)

20% of the gross income (and expenses)

net assets of the organization. However,

of that property is used to figure the

Terminations

do not include the value of services

section 4940 tax on net investment

A private foundation that has terminated

donated to the foundation or items such

income on Form 990-PF. (See Form

its private foundation status under section

as free use of equipment or facilities in

990-T and its instructions for more

507(b)(1)(A), by distributing all its net

contributions received. Also, do not

information.)

assets to one or more public charities

include any expenses used to compute

Investment expenses. Include in

without keeping any right, title, or interest

capital gains and losses on lines 6, 7, and

column (b) all ordinary and necessary

in those assets, should check this box.

8 or expenses included in cost of goods

expenses paid or incurred to produce or

See General Instructions Q and T.

sold on line 10b.

collect investment income from interest,

Item F. 60-Month Termination

dividends, rents, amounts received from

Column (b). Net Investment Income

Under Section 507(b)(1)(B)

payments on securities loans (as defined

All domestic private foundations

in section 512(a)(5)), royalties, income

Check this box if the organization is

(including section 4947(a)(1) nonexempt

from notional principal contracts,

terminating its private foundation status

charitable trusts) are required to pay an

annuities, substantially similar income

under the 60-month provisions of section

excise tax each tax year on net

from ordinary and routine investments,

507(b)(1)(B) during the period covered by

investment income.

and income from similar sources; or for

this return. To begin such a termination, a

Exempt foreign foundations are

the management, conservation, or

private foundation must have given

subject to an excise tax on gross

maintenance of property held for the

advance notice to TE/GE at the Cincinnati

investment income from U.S. sources.

production of income that is taxable under

address given on page 10 and provided

These foreign organizations should

section 4940.

the information outlined in Regulations

complete lines 3, 4, 5, 11, 12, and 27b of

section 1.507-2T(b)(3). See General

If any of the expenses listed in column

column (b) and report only income

Instruction U for information regarding

(a) are paid or incurred for both

derived from U.S. sources. No other

filing requirements during a section

investment and charitable purposes, they

income should be included. No expenses

507(b)(1)(B) termination.

must be allocated on a reasonable basis

are allowed as deductions.

between the investment activities and the

See General Instruction V for

Definitions

charitable activities so that only expenses

information regarding payment of the tax

Gross investment income. Gross

from investment activities appear in

based on investment income (computed

investment income is the total amount of

column (b). Examples of allocation

in Part VI) during a section 507(b)(1)(B)

investment income that was received by a

methods are given in the instructions for

termination.

private foundation from all sources.

Part IX-A.

Item H. Type of Organization

However, it does not include any income

Limitation. The deduction for

subject to the unrelated business income

Check the box for “Section 501(c)(3)

expenses paid or incurred in any tax year

tax. It includes interest, dividends, rents,

exempt private foundation” if the

for producing gross investment income

payments with respect to securities loans

foundation has a ruling or determination

earned incident to a charitable function

(as defined in section 512(a)(5)), royalties

letter from the IRS in effect that

cannot be more than income earned from

received from assets devoted to

recognizes its exemption from federal

the function includible as gross

charitable activities, income from notional

income tax as an organization described

investment income for the year.

principal contracts (as defined in

in section 501(c)(3) or if the organization’s

For example, if rental income is

Regulations section 1.863-7), annuities,

exemption application is pending with the

incidentally realized in 2010 from historic

substantially similar income from ordinary

IRS.

buildings held open to the public,

and routine investments, and income from

Check the “Section 4947(a)(1)

deductions for amounts paid or incurred

similar sources. Therefore, interest

nonexempt charitable trust” box if the

in 2010 for the production of this income

received on a student loan is includible in

trust is a nonexempt charitable trust

may not be more than the amount of

the gross investment income of a private

treated as a private foundation. All others,

rental income includible as gross

foundation making the loan.

check the “Other taxable private

investment income in column (b) for 2010.

Net investment income. Net

foundation” box.

Expenses related to tax-exempt

investment income is the amount by

Item I. Fair Market Value of All

interest. Do not include on lines 13–23

which the sum of gross investment

of column (b) any expenses paid or

Assets

income and the capital gain net income

incurred that are allocable to tax-exempt

exceeds the allowable deductions

In block I on page 1 of Form 990-PF,

interest that is excluded from lines 3

discussed later. Tax-exempt interest on

enter the fair market value of all assets

and 4.

governmental obligations and related

the foundation held at the end of the tax

expenses are excluded.

year.

Column (c). Adjusted Net Income

Investment income. Include in column

This amount should be the same

(b) all or part of any amount from column

Nonoperating private foundations

as the figure reported in Part II,

(a) that applies to investment income.

should see Nonoperating private

line 16, column (c).

TIP

However, do not include in column (b)

foundations, later, to find out if

TIP

any income and related expenses

they need to complete column (c).

Part I. Analysis of Revenue

reported on Form 990-T.

Private operating foundations. All

and Expenses

For example, investment income from organizations that claim status as private

debt-financed property unrelated to the operating foundations under section

Column Instructions

organization’s charitable purpose and 4942(j)(3) or (5) must complete all lines of

The total of amounts in columns (b), (c), certain rents (and related expenses) column (c) that apply, according to the

and (d) may not necessarily equal the treated as unrelated trade or business general rules for income and expenses

amounts in column (a). income should be reported on Form that apply to this column, the specific line

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Schedule B (Form 990, 990-EZ, or

instructions for lines 3–27c, the special kinds of income and expenses (such as

990-PF). If money, securities, or other

rule below and examples 1 and 2 below. investment income and expenses) in

property valued at $5,000 or more was

column (c).

General rules. In general, adjusted net

received directly or indirectly from any

•

If a nonoperating private foundation

income is the amount of a private

one person during the year, complete

has income that it reports on lines 10 and/

foundation’s gross income that is more

Schedule B and attach it to the return. If

or 11, report any expenses relating to this

than the expenses of earning the income.

the foundation is not required to complete

income following the general rules and

The modifications and exclusions

Schedule B (no person contributed

the special rule above. See examples 1

explained below are applied to gross

$5,000 or more), be sure to check the box

and 2 above.

income and expenses in figuring adjusted

on line 2.

net income.

Column (d). Disbursements for

To determine whether a person has

For income and expenses, include on

Charitable Purposes

contributed $5,000 or more, total only

each line of column (c) only that portion of

Expenses entered in column (d) relate to

gifts of $1,000 or more from each person.

the amount from column (a) applicable to

activities that constitute the charitable

Separate and independent gifts need not

the adjusted net income computation.

purpose of the foundation.

be totaled if less than $1,000. If a

Income. For column (c), include

contribution is in the form of property,

For amounts entered in column (d):

income from charitable functions,

describe the property and include its fair

•

Use the cash receipts and

investment activities, short-term capital

market value.

disbursements method of accounting no

gains from investments, amounts set

The term “person” includes individuals,

matter what accounting method is used in

aside, and unrelated trade or business

fiduciaries, partnerships, corporations,

keeping the books of the foundation;

activities. Do not include gifts, grants or

associations, trusts, and exempt

•

Do not include any amount or part of an

contributions, or long-term capital gains or

organizations.

amount included in column (b) or (c);

losses.

•

Include on lines 13–25 all expenses,

Split-interest trusts. Distributions

Expenses. Deductible expenses

including necessary and reasonable

from split-interest trusts should be

include the part of a private foundation’s

administrative expenses, paid by the

entered on line 1, column (a). They are a

operating expenses paid or incurred to

foundation for religious, charitable,

part of the amount on line 1.

produce or collect gross income reported

scientific, literary, educational, or other

Substantiation requirements. An

on lines 3–11 of column (c). If only part of

public purposes, or for the prevention of

organization must keep records, as

the property produces income includible

cruelty to children or animals;

required by the regulations under section

in column (c), deductions such as

•

Include a distribution of property at the

170.

interest, taxes, and rent must be divided

fair market value on the date the

between the charitable and noncharitable

Generally, a donor making a charitable

distribution was made; and

uses of the property. If the deductions for

contribution of $250 or more will not be

•

Include only the part entered in column

property used for a charitable,

allowed a federal income tax deduction

(a) that is allocable to the charitable

educational, or other similar purpose are

unless the donor obtains a written

purposes of the foundation.

more than the income from the property,

acknowledgment from the donee

the excess will not be allowed as a

Example. An educational seminar

organization by the earlier of the date on

deduction but may be treated as a

produced $1,000 in income that was

which the donor files a tax return for the

qualifying distribution in Part I, column (d).

reportable in columns (a) and (c).

tax year in which the contribution was

See Examples 1 and 2 below.

Expenses attributable to this charitable

made or the due date, including

activity were $1,900. Only $1,000 of

extensions, for filing that return. However,

Special rule. The expenses attributable

expense should be reported in column (c)

see section 170(f)(8)(D) and Regulations

to each specific charitable activity, limited

and the remaining $900 in expense

section 1.170A-13(f) for exceptions to this

by the amount of income from the activity,

should be reported in column (d).

rule.

must be reported in column (c) on lines

13–26. If the expenses of any charitable

The written acknowledgment the

Qualifying distributions. Generally,

activity exceed the income generated by

foundation provides to the donor must

gifts and grants to organizations

that activity, only the excess of these

show:

described in section 501(c)(3) that have

expenses over the income should be

been determined to be publicly supported

1. The amount of cash contributed,

reported in column (d).

charities, for example, organizations that

2. A description of any property

Examples.

are not private foundations as defined in

contributed,

section 509(a), are qualifying distributions

3. Whether the foundation provided

1. A charitable activity generated

only if the granting foundation does not

any goods or services to the donor, and

$5,000 of income and $4,000 of

control the public charity.

4. A description and a good-faith

expenses. Report all income and

estimate of the value of any goods or

expenses in column (c) and none in

The total of the expenses and

services the foundation gave in return for

column (d).

disbursements on line 26 is also

the contribution, unless:

2. A charitable activity generated

entered on line 1a in Part XII to

TIP

a. The goods and services have

$5,000 of income and $6,000 of

figure qualifying distributions.

insubstantial value, or

expenses. Report $5,000 of income and

b. A statement is included that these

$5,000 of expenses in column (c) and the

Alternative to completing lines 13–25.

goods and services consist solely of

excess expenses of $1,000 in column (d).

If you want to provide an analysis of

intangible religious benefits.

disbursements that is more detailed than

Nonoperating private foundations.

column (d), you may attach a schedule

The following rules apply to nonoperating Generally, if a charitable organization

instead of completing lines 13–25. The

private foundations. solicits or receives a contribution of more

schedule must include all the specific

•

If a nonoperating private foundation than $75 for which it gives the donor

items of lines 13–25, and the total from

has no income from charitable activities something in return (a quid pro quo

the schedule must be entered on line 26,

that would be reportable on line 10 or line contribution), the organization must

column (d).

11 of Part I, it does not have to make any inform the donor, by written statement,

entries in column (c). that the amount of the contribution

Line Instructions

•

If a nonoperating private foundation deductible for federal income tax

has income from charitable activities, it Line 1. Contributions, gifts, grants, purposes is limited to the amount by

must report that income only on lines 10 etc., received. Enter the total of gross which the contribution exceeds the value

and/or 11 in column (c). These contributions, gifts, grants, and similar of the goods or services received by the

foundations do not need to report other amounts received. donor. The written statement must also

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provide the donor with a good-faith Report rents from other sources on 4. Income received from an estate,

estimate of the value of goods or services line 11. Enter any expenses attributable but only if the estate was considered

given in return for the contribution. to the rental income reported on line 5, terminated for income tax purposes due

such as interest and depreciation, on to a prolonged administration period; and

Penalties. An organization that does

lines 13–23. 5. Amounts treated in an earlier tax

not make the required disclosure for each

year as qualifying distributions to:

quid pro quo contribution will incur a

Line 6a. Net gain or (loss) from sale of

penalty of $10 for each failure, not to

assets Enter the net gain or (loss) per

•

A nonoperating private foundation if the

exceed $5,000 for a particular fundraising

books from all asset sales not included on

amounts were not redistributed by the

event or mailing, unless it can show

line 10.

grantee organization by the close of its

reasonable cause for not providing the

tax year following the year in which it

For assets sold and not included in

disclosure.

received the funds, or

Part IV, attach a schedule showing:

For more information. See

•

An organization controlled by the

•

Date acquired,

Regulations section 1.170A-13 for more

distributing foundation or a disqualified

•

Manner of acquisition,

information on charitable recordkeeping

person if the amounts were not

•

Gross sales price,

and substantiation requirements.

redistributed by the grantee organization

•

Cost, other basis, or value at time of

by the close of its tax year following the

acquisition (if donated) and which of

Line 2. Check this box if the foundation

year in which it received the funds.

these methods was used,

is not required to attach Schedule B.

•

Date sold,

Lines 10a, b, c. Gross profit from sales

Line 3. Interest on savings and

•

To whom sold,

of inventory. Enter the gross sales (less

temporary cash investments.

•

Expense of sale and cost of

returns and allowances), cost of goods

In column (a). Enter the total amount

improvements made subsequent to

sold, and gross profit or (loss) from the

of interest income from investments

acquisition, and

sale of all inventory items, including those

reportable in Part II, line 2. These include

•

Depreciation since acquisition (if

sold in the course of special events and

savings or other interest-bearing accounts

depreciable property).

activities. These inventory items are the

and temporary cash investments, such as

Line 6b. Gross sales price for all

ones the organization either makes to sell

money market funds, commercial paper,

assets on line 6a. Enter the gross sales

to others or buys for resale.

certificates of deposit, and U.S. Treasury

price from all asset sales whose net gain

bills or other government obligations that

Do not report any sales or exchanges

or loss was reported on line 6a.

mature in less than 1 year.

of investments on line 10.

Line 7. Capital gain net income. Enter

In column (b). Enter the amount of

Do not include any profit or (loss) from

the capital gain net income from Part IV,

interest income shown in column (a). Do

the sale of capital items such as

line 2. See Part IV instructions.

not include interest on tax-exempt

securities, land, buildings, or equipment

Line 8. Net short-term capital gain.

government obligations.

on line 10. Enter these amounts on

In column (c). Enter the amount of

line 6a.

Only private operating foundations

interest income shown in column (a).

report their short-term capital

Do not include any business expenses

Include interest on tax-exempt

gains on line 8.

TIP

such as salaries, taxes, rent, etc., on line

government obligations.

10. Include them on lines 13–23.

Include only net short-term capital gain

Line 4. Dividends and interest from

for the year (assets sold or exchanged

Attach a schedule showing the

securities.

that were held not more than 1 year). Do

following items: gross sales, cost of

In column (a). Enter the amount of

not include net long-term capital gain or

goods sold, gross profit or (loss). These

dividend and interest income from

net loss in column (c).

items should be classified according to

securities (stocks and bonds) reportable

type of inventory sold (such as books,

Do not include on line 8 a net gain

in Part II, line 10. Include amounts

tapes, other educational or religious

from the sale or exchange of depreciable

received from payments on securities

material, etc.). The totals from the

property, or land used in a trade or

loans as defined in section 512(a)(5). Do

schedule should agree with the entries on

business (section 1231) and held for

not include any capital gain dividends

lines 10a–10c.

more than 1 year. However, include net

reportable on line 6. Report income from

loss from such property on line 23 as an

In column (c), enter the gross profit or

program-related investments on line 11.

Other expense.

(loss) from sales of inventory shown on

For debt instruments with an original

In general, foundations may carry to

line 10c, column (a).

issue discount, report the original issue

line 8 the net short-term capital gain

discount ratably over the life of the bond

Line 11. Other income. Enter the total

reported in Part IV, line 3. However, if the

on line 4. See section 1272 for more

of all the foundation’s other income for the

foundation had any short-term capital

information.

year. Attach a schedule that gives a

gain from sales of debt-financed property,

description and the amount of the income.

In column (b). Enter the amount of

add it to the amount reported in Part IV,

Include all income not reported on lines 1

dividend and interest income and

line 3 to figure the amount to include on

through 10c. Also, see the instructions for

payments on securities loans from

line 8. For the definition of “debt-financed

Part XVI-A, line 11 later.

column (a). Do not include interest on

property,” see the Instructions for Form

tax-exempt government obligations.

Include imputed interest on certain

990-T.

In column (c). Enter the amount of

deferred payments figured under section

Line 9. Income modifications. Include

dividend and interest income and

483 and any investment income not

on this line:

payments on securities loans from

reportable on lines 3 through 5, including

1. Amounts received or accrued as

column (a). Include interest on

income from program-related investments

repayments of amounts taken into

tax-exempt government obligations.

(defined in the instructions for Part IX-B).

account as qualifying distributions;

Line 5a. Gross rents.

Do not include unrealized gains and

2. Amounts received or accrued from

In column (a). Enter the gross rental

losses on investments carried at market

the sale or other disposition of property to

income for the year from investment

value. Report those as fund balance or

the extent that the acquisition of the

property reportable in Part II, line 11.

net asset adjustments in Part III.

property was considered a qualifying

In columns (b) and (c). Enter the

distribution for any tax year; In column (b). Enter the amount of

gross rental income from column (a).

3. Any amount set aside for a specific investment income included in line 11,

Line 5b. Net rental income or (loss). project (see explanation in the column (a). Include dividends, interest,

Figure the net rental income or (loss) for instructions for Part XII) that was not rents, and royalties derived from assets

the year and enter that amount on the necessary for the purposes for which it devoted to charitable activities, such as

entry line to the left of column (a). was set aside; interest on student loans.

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Form 990-PF Instructions

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In column (c). Include all other items foundation as a result of legal Line 20. Occupancy. Enter the amount

includible in adjusted net income not proceedings on line 23. paid or incurred for the use of office

covered elsewhere in column (c). space or other facilities. If the space is

Line 18. Taxes. Attach a schedule

rented or leased, enter the amount of

Line 12. Total. In column (b). Domestic

listing the type and amount of each tax

rent. If the space is owned, enter the

organizations should enter the total of

reported on line 18. Do not enter any

amount of mortgage interest, real estate

lines 3–11. Exempt foreign organizations

taxes included on line 15.

taxes, and similar expenses, but not

should enter the total of lines 3, 4, 5, and

In column (a). Enter the taxes paid

depreciation reportable on line 19. In

11 only.

(or accrued) during the year. Include all

either case, include the amount for

Line 13. Compensation of officers,

types of taxes recorded on the books,

utilities and related expenses (for

directors, trustees, etc.

including real estate tax not reported on

example, heat, lights, water, power,

line 20; the tax on investment income;

In column (a). Enter the total

telephone, sewer, trash removal, outside

and any income tax.

compensation for the year of all officers,

janitorial services, and similar services).

directors, and trustees. If none was paid,

Do not include any salaries of the

In column (b). Enter only those taxes

enter zero. Complete line 1 of Part VIII to

organization’s own employees reportable

included in column (a) related to

show the compensation of officers,

on line 14.

investment income taxable under section

directors, trustees, and foundation

4940. Do not include the section 4940 tax

Line 21. Travel, conferences, and

managers.

paid or incurred on net investment income

meetings. Enter the expenses for

or the section 511 tax on unrelated

In columns (b), (c), and (d). Enter

officers, employees, or others during the

business income. Sales taxes may not be

the portion of the compensation included

year for travel, attending conferences,

deducted separately but must be treated

in column (a) that is applicable to the

meetings, etc. Include transportation

as a part of the cost of acquired property

column. For example, in column (c) enter

(including fares, mileage allowance, or

or as a reduction of the amount realized

the portion of the compensation included

automobile expenses), meals and

on disposition of the property.

in column (a) paid or incurred to produce

lodging, and related costs whether paid

or collect income included in column (c).

In column (c). Enter only those taxes

on the basis of a per diem allowance or

included in column (a) that relate to

actual expenses incurred. Do not include

Line 14. Other employee salaries and

income included in column (c). Do not

any compensation paid to those who

wages. Enter the salaries and wages of

include any excise tax paid or incurred on

participate.

all employees other than those included

the net investment income (as shown in

on line 13.

In column (b). Only 50% of the

Part VI) or any tax reported on Form

Line 15. Contributions to employee

expense for business meals, etc., paid or

990-T.

pension plans and other benefits.

incurred in connection with travel,

Enter the employer’s share of

In column (d). Do not include any

meetings, etc., relating to the production

contributions the organization paid to

excise tax paid on investment income (as

of investment income may be deducted in

qualified and nonqualified pension plans

reported in Part VI of this return or the

figuring net investment income (section

and the employer’s share of contributions

equivalent part of a return for prior years)

274(n)).

to employee benefit programs (such as

unless the organization is claiming status

In column (c). Enter the total amount

insurance, health, and welfare programs)

as a private operating foundation and

of expenses paid or incurred by officers,

that are not an incidental part of a

completes Part XIV.

employees, or others for travel,

pension plan. Complete the return/report

Line 19. Depreciation and depletion.

conferences, meetings, etc., related to

of the Form 5500 series appropriate for

income included in column (c).

In column (a). Enter the expense

the organization’s plan. See the

recorded in the books for the year.

Instructions for Form 5500 for information

Line 22. Printing and publications.

about employee welfare benefit plans

For depreciation, attach a schedule

Enter the expenses for printing or

required to file that form.

showing:

publishing and distributing any

•

A description of the property,

newsletters, magazines, etc. Also include

Also include the amount of federal,

•

The date acquired,

the cost of subscriptions to, or purchases

state, and local payroll taxes for the year,

•

The cost or other basis (exclude any

of, magazines, newspapers, etc.

but only include those that are imposed

land),

on the organization as an employer. This

Line 23. Other expenses. Enter all

•

The depreciation allowed or allowable

includes the employer’s share of social

other expenses for the year. Include all

in prior years,

security and Medicare taxes, FUTA tax,

expenses not reported on lines 13–22.

•

The method of computation,

state unemployment compensation tax,

Attach a schedule showing the type and

•

The rate (%) or life (years), and

and other state and local payroll taxes.

amount of each expense.

•

The depreciation this year.

Do not include taxes withheld from

If a deduction is claimed for

employees’ salaries and paid over to the

On a separate line on the schedule,

amortization, attach a schedule showing:

various governmental units (such as

show the amount of depreciation included

•

Description of the amortized expenses;

federal and state income taxes and the

in cost of goods sold and not included on

•

Date acquired, completed, or

employee’s share of social security and

line 19.

expended;

Medicare taxes).

In columns (b) and (c). A deduction

•

Amount amortized;

Lines 16a, b, and c. Legal, accounting,

for depreciation is allowed only for

•

Deduction for prior years;

and other professional fees. On the

property used in the production of income

•

Amortization period (number of

appropriate line(s), enter the legal,

reported in the column, and only using the

months);

accounting, auditing, and other

straight line method of computing

•

Current-year amortization; and

professional fees (such as fees for

depreciation. A deduction for depletion is

•

Total amount of amortization.

fundraising or investment services)

allowed but must be figured only using

charged by outside firms and individuals

In column (c). In addition to the

the cost depletion method.

who are not employees of the foundation.

applicable portion of expenses from

The basis used in figuring depreciation

column (a), include any net loss from the

Attach a schedule for lines 16a, b, and

and depletion is the basis determined

sale or exchange of land or depreciable

c. Show the type of service and expense

under normal basis rules, without regard

property that was held for more than

for each. If the same person provided

to the special rules for using the fair

1 year and used in a trade or business.

more than one of these services, include

market value on December 31, 1969, that

an allocation of those expenses.

relate only to gain or loss on dispositions A deduction for amortization is allowed

Report any fines, penalties, or for purposes of the tax on net investment but only for assets used for the production

judgments imposed against the income. of income reported in column (c).

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Form 990-PF Instructions

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Line 25. Contributions, gifts, grants

the donees are exempt from tax under

Part II. Balance Sheets

paid.

section 501(c)(3), they redistribute the

For column (b), show the book value at

contributions, and they maintain sufficient

In column (a). Enter the total of all

the end of the year. For column (c), show

evidence of redistributions according to

contributions, gifts, grants, and similar

the fair market value at the end of the

the regulations under section 4942(g).

amounts paid (or accrued) for the year.

year. Attached schedules must show the

•

Do not include contributions paid from

List each contribution, gift, grant, etc., in

end-of-year value for each asset listed in

a nonoperating private foundation to a

Part XV, or attach a schedule of the items

columns (b) and (c).

Type III supporting organization as

included on line 25 and list:

Foundations whose books of account

defined under section 4943(f)(5) that is

1. Each class of activity,

included total assets of $5,000 or more at

not a functionally integrated Type III

2. A separate total for each activity,

any time during the year must complete

supporting organization as defined under

3. Name and address of donee,

all of columns (a), (b), and (c).

section 4943(f)(5)(B). See Ann. 2007-87,

4. Relationship of donee if related by:

2007-40 I.R.B. 753, available at www.irs.

Foundations with less than $5,000 of

a. Blood,

gov/irb/2007-40_IRBar17.html.

total assets per books at all times during

b. Marriage,

the year must complete all of columns (a)

•

Do not include contributions paid from

c. Adoption, or

and (b) and only line 16 of column (c).

a nonoperating private foundation to any

d. Employment (including children of

supporting organization if a disqualified

employees) to any disqualified person

Line 1. Cash—Non-interest-bearing.

person of the private foundation controls

(see General Instruction C for definitions),

Enter the amount of cash on deposit in

the supporting organization or any of its

and

checking accounts, deposits in transit,

supported organizations. See Notice

change funds, petty cash funds, or any

5. The organizational status of donee

2006-109, 2006-51 I.R.B. 1121, as

other non-interest-bearing account. Do

(for instance, public charity—an

modified by Rev. Proc. 2009-32, 2009-28

not include advances to employees or

organization described in section

I.R.B. 142 available at www.irs.gov/irb/

officers or refundable deposits paid to

509(a)(1), (2), or (3)).

2009–28_IRS/ar10.html.

suppliers or others.

•

Do not reduce the amount of grants

You do not have to give the name of

Line 2. Savings and temporary cash

paid in the current year by the amount of

any indigent person who received one or

investments. Enter the total of cash in

grants paid in a prior year returned or

more gifts or grants from the foundation

savings or other interest-bearing accounts

recovered in the current year. Report

unless that individual is a disqualified

and temporary cash investments, such as

those repayments on line 9, column (c),

person or one who received a total of

money market funds, commercial paper,

and in Part XI, line 4.

more than $1,000 from the foundation

certificates of deposit, and U.S. Treasury

during the year.

•

Do not include any payments of

bills or other governmental obligations

set-asides (see instructions for Part XII,

Activities should be classified

that mature in less than 1 year.

line 3) taken into account as qualifying

according to purpose and in greater detail

Line 3. Accounts receivable. On the

distributions in the current year or any

than merely classifying them as

dashed lines to the left of column (a),

prior year. All set-asides are included in

charitable, educational, religious, or

enter the year-end figures for total

qualifying distributions (Part XII, line 3) in

scientific activities. For example, use

accounts receivable and allowance for

the year of the set-aside, regardless of

identification such as payments for

doubtful accounts from the sale of goods

when paid.

nursing service, for fellowships, or for

and/or the performance of services. In

•

Do not include current year write-offs of

assistance to indigent families.

columns (a), (b), and (c), enter net

prior years’ program-related investments.

Foundations may include, as a single

amounts (total accounts receivable

All program-related investments are

entry on the schedule, the total of

reduced by the corresponding allowance

included in qualifying distributions (Part

amounts paid as grants for which the

for doubtful accounts). Claims against

XII, line 1b) in the year the investment is

foundation exercised expenditure

vendors or refundable deposits with

made.

responsibility. Attach a separate report for

suppliers or others may be reported here

•

Do not include any payments that are

each grant.

if not significant in amount. (Otherwise,

not qualifying distributions as defined in

report them on line 15.) Any receivables

When the fair market value of the

section 4942(g)(1).

due from officers, directors, trustees,

property at the time of disbursement is

foundation managers, or other

the measure of a contribution, the

Net Amounts

disqualified persons must be reported on

schedule must also show:

line 6. Report receivables (including loans

•

A description of the contributed

Line 27a. Excess of revenue over

and advances) due from other employees

property,

expenses and disbursements.

on line 15.

•

The book value of the contributed

Subtract line 26, column (a), from line 12,

property,

column (a) and enter the result.

Line 4. Pledges receivable. On the

•

The method used to determine the

Generally, the amount shown in column

dashed lines to the left of column (a),

book value,

(a) on this line is also the amount by

enter the year-end figures for total

•

The method used to determine the fair

which net assets (or fund balances) have

pledges receivable and allowance for

market value, and

increased or decreased for the year. See

doubtful accounts (pledges estimated to

•

The date of the gift.

the instructions for Part III, Analysis of

be uncollectible). In columns (a), (b), and

Changes in Net Assets or Fund Balances.

(c), enter net amounts (total pledges

The difference between fair

receivable reduced by the corresponding

market value and book value

Line 27b. Net investment income.

allowance for doubtful accounts).

should be shown in the books of

TIP

Domestic organizations should subtract

Line 5. Grants receivable. Enter the

account and as a net asset adjustment in

line 26 from line 12 and enter the result.

total grants receivable from governmental

Part III.

Exempt foreign organizations should

agencies, foundations, and other

In column (d). Enter on line 25 all

enter the amount shown on line 12.

organizations as of the beginning and end

contributions, gifts, and grants the

However, if the organization is a domestic

of the year.

foundation paid during the year with the

organization and line 26 is more than line

following exceptions. Line 6. Receivables due from officers,

12 (such as when expenses exceed

•

Do not include contributions to directors, trustees, and other

income), enter zero (not a negative

organizations controlled by the foundation disqualified persons. Enter here (and

amount).

or by a disqualified person (see General on an attached schedule described

Instruction C for definitions). Line 27c. Adjusted net income. below) all receivables due from officers,

•

Do not include contributions to Subtract line 26, column (c) from line 12, directors, trustees, foundation managers,

nonoperating private foundations unless column (c) and enter the result. and other disqualified persons and all

-15-

Form 990-PF Instructions

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The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

secured and unsecured loans (including Loans receivable. In columns (a), Line 13. Investments—other. Enter the

advances) to such persons. Disqualified (b), and (c), enter the gross amount of amount of all other investment holdings

person is defined in General loans receivable, minus the allowance for not reported on lines 10 through 12.

Instruction C. doubtful accounts, from the normal Attach a schedule listing and describing

activities of the filing organization (such each of these investments held at the end

Attached schedules. (a) On the

as scholarship loans). An itemized list of of the year. Show the book value for each

required schedule, report each loan

these loans is not required, but attach a and indicate whether the investment is

separately, even if more than one loan

schedule showing the total amount of listed at cost or end-of-year market value.

was made to the same person or the

each type of outstanding loan. Report Do not include program-related

same terms apply to all loans made.

loans to officers, directors, trustees, investments (see instructions for line 15).

Salary advances and other advances

foundation managers, or other

Line 14. Land, buildings, and

for the personal use and benefit of the

disqualified persons on line 6 and loans to

equipment. On the dashed lines to the

recipient and receivables subject to

other employees on line 15.

left of column (a), enter the year-end book

special terms or arising from transactions

Line 8. Inventories for sale or use.

value (cost or other basis) and

not functionally related to the foundation’s

Enter the amount of materials, goods, and

accumulated depreciation of all land,

charitable purposes must be reported as

supplies purchased or manufactured by

buildings, and equipment owned by the

separate loans for each officer, director,

the organization and held for sale or use

organization and not held for investment.

etc.

in some future period.

In columns (a) and (b), enter the book

(b) Receivables that are subject to

value of all land, buildings, and equipment

Line 9. Prepaid expenses and deferred

the same terms and conditions (including

not held for investment less accumulated

charges. Enter the amount of short-term

credit limits and rate of interest) as

depreciation. In column (c), enter the fair

and long-term prepayments of expenses

receivables due from the general public

market value of these assets. Include any

attributable to one or more future

from an activity functionally related to the

property, plant, and equipment owned

accounting periods. Examples include

foundation’s charitable purposes may be

and used by the organization to conduct

prepayments of rent, insurance, and

reported as a single total for all the

its charitable activities. Attach a schedule

pension costs, and expenses incurred in

officers, directors, etc. Travel advances

listing these fixed assets held at the end

connection with a solicitation campaign to

made for official business of the

of the year and showing the cost or other

be conducted in a future accounting

organization may also be reported as a

basis, accumulated depreciation, and

period.

single total.

book value of each item or category

Lines 10a, b, and c. Investments—

listed.

For each outstanding loan or other

government obligations, corporate

receivable that must be reported

Line 15. Other assets. List and show

stocks and bonds. Enter the book

separately, the attached schedule should

the book value of each category of assets

value (which may be market value) of

show the following information (preferably

not reportable on lines 1 through 14.

these investments.

using columns):

Attach a separate schedule if more space

Attach a schedule that lists each

is needed.

1. Borrower’s name and title,

security held at the end of the year and

2. Original amount,

One type of asset reportable on line 15

shows whether the security is listed at

3. Balance due,

is program-related investments. These

cost (including the value recorded at the

4. Date of note,

are investments made primarily to

time of receipt in the case of donated

5. Maturity date,

accomplish a charitable purpose of the

securities) or end-of-year market value.

6. Repayment terms,

filing organization with no significant

Do not include amounts shown on line 2.

7. Interest rate,

purpose to produce income.

Governmental obligations reported on line

8. Security provided by the borrower,

10a are those that mature in 1 year or

Line 16. Total assets. All filers must

9. Purpose of the loan, and

more. Debt securities of the U.S.

complete line 16 of columns (a), (b), and

10. Description and fair market value of

Government may be reported as a single

(c). These entries represent the totals of

the consideration furnished by the lender

total rather than itemized. Obligations of

lines 1 through 15 of each column.

(for example, cash—$1,000; or 100

state and municipal governments may

However, foundations that have assets of

shares of XYZ, Inc., common stock—

also be reported as a lump-sum total. Do

less than $5,000 per books at all times

$9,000).

not combine U.S. Government obligations

during the year need not complete lines 1

with state and municipal obligations on

through 15 of column (c).

The above detail is not required for

this schedule.

receivables or travel advances that may

The column (c) amount is also

Line 11. Investments—land, buildings,

be reported as a single total (see (b)

entered on the entry space for I in

and equipment. On the dashed lines to

above); however, report and identify

the Entity section on page 1.

TIP

the left of column (a), enter the year-end

those totals separately on the attachment.

book value (cost or other basis) and

Line 17. Accounts payable and

Line 7. Other notes and loans

accumulated depreciation of all land,

accrued expenses. Enter the total of

receivable. On the dashed lines to the

buildings, and equipment held for

accounts payable to suppliers and others

left of column (a), enter the combined

investment purposes, such as rental

and accrued expenses, such as salaries

total year-end figures for notes receivable

properties. In columns (a) and (b), enter

payable, accrued payroll taxes, and

and loans receivable and the allowance

the book value of all land, buildings, and

interest payable.

for doubtful accounts.

equipment held for investment less

Line 18. Grants payable. Enter the

Notes receivable. In columns (a),

accumulated depreciation. In column (c),

unpaid portion of grants and awards the

(b), and (c), enter the amount of all notes

enter the fair market value of these

organization has made a commitment to

receivable not listed on line 6 and not

assets. Attach a schedule listing these

pay other organizations or individuals,

acquired as investments. Attach a

investment fixed assets held at the end of

whether or not the commitments have

schedule similar to the one for line 6. The

the year and showing, for each item or

been communicated to the grantees.

schedule should also identify the

category listed, the cost or other basis,

relationship of the borrower to any officer,

Line 19. Deferred revenue. Include

accumulated depreciation, and book

director, trustee, foundation manager, or

revenue that the organization has

value.

other disqualified person.

received but not yet earned as of the

Line 12. Investments—mortgage

balance sheet date under its method of

For a note receivable from any section loans. Enter the amount of mortgage

accounting.

501(c)(3) organization, list only the name loans receivable held as investments but

of the borrower and the balance due on do not include program-related Line 20. Loans from officers, directors,

the required schedule. investments (see instructions for line 15). trustees, and other disqualified

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persons. Enter the unpaid balance of of income. The latter result from gifts and between the net assets at the beginning

loans received from officers, directors, bequests that create permanent and end of the year.

trustees, and other disqualified persons. endowment funds.

On Part III, line 2, re-enter the figure

For loans outstanding at the end of the

Foundations that do not follow SFAS

from Part I, line 27(a), column (a).

year, attach a schedule that shows (for

117 (ASC 958). If the foundation does

On lines 3 and 5, list any changes in

each loan) the name and title of the

not follow SFAS 117 (ASC 958), check

net assets that were not caused by the

lender and the information listed in items

the box above line 27 and report account

receipts or expenses shown in Part I,

2 through 10 of the instructions for line 6

balances on lines 27 through 29. Report

column (a). For example, if a foundation

above.

net assets or fund balances on line 30.

follows SFAS 115 (ASC 320-10-35) and

Line 21. Mortgages and other notes

Also complete line 31 to report the sum of

shows an asset in the ending balance

payable. Enter the amount of mortgages

the total liabilities and net assets/fund

sheet at a higher value than in the

and other notes payable at the beginning

balances.

beginning balance sheet because of an

and end of the year. Attach a schedule

Line 27. Capital stock, trust principal,

increased market value (after a larger

showing, as of the end of the year, the

or current funds. For corporations,

decrease in a prior year), include the

total amount of all mortgages payable

enter the balance per books for capital

increase in Part III, line 3.

and, for each nonmortgage note payable,

stock accounts. Show par or stated value

If the organization uses a stepped-up

the name of the lender and the other

(or for stock with no par or stated value,

basis to determine gains on sales of

information specified in items 2 through

total amount received upon issuance) of

assets included in Part I, column (a), then

10 of the instructions for line 6. The

all classes of stock issued and, as yet,

include the amount of step-up in basis in

schedule should also identify the

uncanceled. For trusts, enter the amount

Part III. If you entered a contribution, gift,

relationship of the lender to any officer,

in the trust principal or corpus account.

or grant of property valued at fair market

director, trustee, foundation manager, or

For foundations continuing to use the

value in Part I, line 25, column (a), the

other disqualified person.

fund method of accounting, enter the fund

difference between fair market value and

Line 22. Other liabilities. List and show

balances for the foundation’s current

book value should be shown in the books

the amount of each liability not reportable

restricted and unrestricted funds.

of account and as a net asset adjustment

on lines 17 through 21. Attach a separate

Line 28. Paid-in or capital surplus, or

in Part III.

schedule if more space is needed.

land, building, and equipment fund.

Enter the balance per books for all paid-in

Lines 24 Through 31. Net

Part IV. Capital Gains and

capital in excess of par or stated value for

Assets or Fund Balances

Losses for Tax on

all stock issued and uncanceled. If

Foundations that follow SFAS 117

stockholders or others gave donations

Investment Income

(ASC 958). If the foundation follows

that the organization records as paid-in

Use Part IV to figure the amount of net

SFAS 117 (ASC 958), check the box

capital, include them here. Report any

capital gain to report on lines 7 and 8 of

above line 24. Classify and report net

current-year donations you included on

Part I.

assets in three groups—unrestricted,

line 28 in Part I, line 1. The fund balance

temporarily restricted, and permanently

for the land, building, and equipment fund

Part IV does not apply to foreign

restricted—based on the existence or

would be entered here.

organizations.

absence of donor-imposed restrictions

Line 29. Retained earnings,

Nonoperating private foundations may

and the nature of those restrictions. Show

accumulated income, endowment, or

not have to figure their short-term capital

the sum of the three classes of net assets

other funds. For corporations, enter the

gain or loss on line 3. See Nonoperating

on line 30. On line 31, add the amounts

balance in the retained earnings, or

private foundations on page 12.

on lines 23 and 30 to show total liabilities

similar account, minus the cost of any

and net assets. This figure should be the

Reportable gains and losses. Capital

corporate treasury stock. For trusts, enter

same as the figure for total assets on line

gains or losses include gains or losses

the balance per books in the accumulated

16.

from the sale or other disposition of

income or similar account. For

property that:

Line 24. Unrestricted. Enter the

foundations using fund accounting, enter

•

Is used for a charitable purpose,

balances per books of the unrestricted

the total of the fund balances for the

•

Is held for investment, or

class of net assets. Unrestricted net

permanent and term endowment funds as

•

Is used in the production of income. Do

assets are neither permanently restricted

well as balances of any other funds not

not include the gain or loss that is

nor temporarily restricted by

reported on lines 27 and 28.

included in figuring the foundation’s

donor-imposed stipulations. All funds

Line 30. Total net assets or fund

unrelated business taxable income.

without donor-imposed restrictions must

balances. For foundations that follow

be classified as unrestricted, regardless

However, do not include gains or

SFAS 117 (ASC 958), enter the total of

of the existence of any board

losses for any portion of property if:

lines 24 through 26. For all other

designations or appropriations.

•

The property was used for 1 year or

foundations, enter the total of lines 27

more in furthering the foundation’s

Line 25. Temporarily restricted. Enter

through 29. Enter the beginning-of-year

exempt purpose or function, and

the balances per books of the temporarily

figure in Part III, line 1. The end-of-year

•

Immediately following the use, is

restricted class of net assets. Donors’

figure in column (b) must agree with the

exchanged for property of like kind that is

temporary restrictions may require that

figure in Part III, line 6.

to be used primarily in furthering the

resources be used in a later period or

Line 31. Total liabilities and net assets/

foundation’s exempt purpose or function.

after a specified date (time restrictions),

fund balances. Enter the total of lines

Rules similar to the rules of section 1031

or that resources be used for a specified

23 and 30. This amount must equal the

relating to exchange of property held for

purpose (purpose restrictions), or both.

amount for total assets reported on line

productive use or investment apply. See

Line 26. Permanently restricted. Enter

16 for both the beginning and end of the

Gross Investment Income on page 11.

the total of the balances for the

year.

permanently restricted class of net Basis. The basis for determining gain

assets. Permanently restricted net assets from the sale or other disposition of

Part III. Analysis of

are (a) assets, such as land or works of property is the larger of:

art, donated with stipulations that they be

•

The fair market value of the property on

Changes in Net Assets or

used for a specified purpose, be December 31, 1969, plus or minus all

Fund Balances

preserved, and not be sold or (b) assets adjustments after December 31, 1969,

donated with stipulations that they be Generally, the excess of revenue over and before the date of disposition, if the

invested to provide a permanent source expenses accounts for the difference foundation held the property on that date

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and continuously after that date until reduced 1% tax under section 4940(e) on Taxable foreign private foundations

disposition, or net investment income rather than the 2% that filed Form 1040NR, U.S. Nonresident

•

The basis of the property on the date of tax on net investment income under Alien Income Tax Return, or Form

disposition under normal basis rules section 4940(a). 1120-F, U.S. Income Tax Return of a

(actual basis). See Code sections Foreign Corporation, enter“N/A” in Part

Do not complete Part V if this is the

1011–1022. VI.

organization’s first year. A private

Estimated tax. Domestic exempt and

The rules that generally apply to

foundation cannot qualify under section

taxable private foundations and section

property dispositions reported in this part

4940(e) for its first year of existence, nor

4947(a)(1) nonexempt charitable trusts

are:

can a former public charity qualify for the

may have to make estimated tax

•

Section 1011, adjusted basis for

first year it is treated as a private

payments for the excise tax based on

determining gain or loss;

foundation.

investment income. See General

•

Section 1012, basis of property-cost;

A separate computation must be made

Instruction O for more information.

•

Section 1014, basis of property

for each year in which the foundation

acquired from a decedent before 2010;

Tax Computation

wants to qualify for the reduced tax.

•

Section 1015, basis of property

Line 1, column (b). Enter the amount of

acquired by gifts and transfers in trust;

Line 1a only applies to domestic

adjusted qualifying distributions made for

•

Section 1016, adjustments to basis;

exempt operating foundations

each year shown. The amounts in column

and

described in section 4940(d)(2)

CAUTION

(b) are taken from Part XII, line 6 of the

•

Section 1022, basis of property

that have a ruling or determination letter

Form 990-PF for 2005–2009.

acquired from a decedent after 2009.

from the IRS establishing exempt

To figure a loss, basis on the date of

Line 1, column (c). Enter the net value

operating foundation status. If your

disposition is determined under normal

of noncharitable-use assets for each year.

organization does not have this letter,

basis rules.

The amounts in column (c) are taken from

skip line 1a.

Part X, line 5, for 2005–2009.

Losses. If the disposition of

Line 1a. A domestic exempt private

investment property results in a loss, that

foundation that qualifies as an exempt

Part VI. Excise Tax Based

loss may be subtracted from capital gains

operating foundation under section

realized from the disposition of property

4940(d)(2) is not liable for any tax on net

on Investment Income

during the same tax year but only to the

investment income on this return.

extent of the gains. If losses are more

(Section 4940(a), 4940(b),

If your organization qualifies, check the

than gains, the excess may not be

box and enter the date of the ruling or

4940(e), or 4948)

subtracted from gross investment income

determination letter on line 1a and enter

nor may the losses be carried back or

“N/A” on line 1. Leave the rest of Part Vl

General Rules

forward to other tax years.

blank. For the first year, the organization

Domestic exempt private foundations.

must attach a copy of the ruling or

Reporting Transactions in Part

These foundations are subject to a 2%

determination letter establishing exempt

tax on net investment income under

operating foundation status. As long as

section 4940(a). However, certain exempt

Publicly traded securities. For sales of

the organization retains this status, write

operating foundations described in

publicly traded securities through a

the date of the ruling or determination

section 4940(d)(2) may not owe any tax,

broker, enter the description “publicly

letter in the space on line 1a. If the

and certain private foundations that meet

traded securities” on line 1, column (a).

organization no longer qualifies under

the requirements of section 4940(e) may

Leave columns (b), (c), and (d) blank.

section 4940(d)(2), leave the date line

qualify for a reduced tax of 1% (see the

Total the gross sales price, the cost or

blank and compute the section 4940 tax

Part V instructions).

other basis, and the expense of sale on

in the normal manner.

all such securities sold. Report these

Exception. The section 4940 tax

Qualification. To qualify as an

lump-sum figures in columns (e) through

does not apply to an organization making

exempt operating foundation for a tax

(l), as appropriate. You must maintain

an election under section 41(e)(6). Enter

year, an organization must meet the

detailed records of each transaction in

“N/A” in Part VI.

following requirements of section

your books and records.

4940(d)(2).

Domestic taxable private foundations

•

It is an operating foundation described

Publicly traded securities are securities

and section 4947(a)(1) nonexempt

in section 4942(j)(3).

that are listed and regularly traded on an

charitable trusts. These organizations

•

It has been publicly supported for at

over-the-counter market or an established

are subject to a modified 2% tax on net

least 10 tax years or was a private

exchange in which market quotations are

investment income under section 4940(b).

operating foundation on January 1, 1983,

published or otherwise readily available.

(See Part V and its instructions to find out

or for its last tax year ending before

Securities include:

if they meet the requirements of section

January 1, 1983.

•

Common and preferred stock,

4940(e) that allows them to use a

•

Its governing body, at all times during

•

Bonds (including governmental

modified 1% tax on net investment

the tax year, consists of individuals less

obligations), and

income.) However, they must first

than 25% of whom are disqualified

•

Mutual fund shares.

compute the tax under section 4940(a) as

individuals and is broadly representative

if that tax applied to them.

Other gains and losses. For sales of

of the general public.

anything other than publicly traded

Foreign organizations. Under section

•

It has no officer who was a disqualified

securities sold, each transaction must be

4948, exempt foreign private foundations

individual at any time during the tax year.

listed and reported separately, completing

are subject to a 4% tax on their gross

Line 1c. Exempt foreign organizations

all appropriate columns in Part IV.

investment income derived from U.S.

should not include net capital gain income

sources.

when computing the excise tax due under

Part V. Qualification Under

section 4948(a).

Under new section 871(m) added

Section 4940(e) for

by the Hiring Incentives to Restore Line 2. Section 511 tax. Under section

Employment Act (HIRE), a 4940(b), a domestic section 4947(a)(1)

CAUTION

Reduced Tax on Net

“dividend equivalent” is treated as a nonexempt charitable trust or taxable

Investment Income

dividend from U.S. sources for certain private foundation must add to the tax

This part is used by domestic private purposes, including U.S. withholding tax figured under section 4940(a) (on line 1)

foundations (exempt and taxable) to rules applicable to foreign organizations. the tax which would have been imposed

determine whether they qualify for the See section 871(m) for more information. under section 511 for the tax year if it had

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been exempt from tax under section Do not claim erroneous backup expenditures). A private foundation may

501(a). If the domestic section 4947(a)(1) withholding on line 6d if you claim satisfy these section 508(e) requirements

nonexempt charitable trust or taxable it on Form 990-T. either by express language in its

CAUTION

private foundation has unrelated business governing instrument or by application of

Line 8. Penalty. Enter any penalty for

taxable income that would have been state law that imposes the above

underpayment of estimated tax shown on

subject to the tax imposed by section 511, requirements on the foundation or treats

Form 2220. Form 2220 is used by both

the computation of tax must be shown in these requirements as being contained in

corporations and trusts.

an attachment. Form 990-T may be used the governing instrument. If an

Line 9. Tax due. Domestic foundations

as the attachment. All other filers, enter organization claims it satisfies the

should see General Instruction P.

zero. requirements of section 508(e) by

All foreign organizations should

operation of state law, the provisions of

Line 4. Subtitle A tax. Domestic section

enclose a check or money order (in U.S.

state law must effectively impose the

4947(a)(1) nonexempt charitable trusts

funds), made payable to the United

section 508(e) requirements on the

and taxable private foundations, enter the

States Treasury, with Form 990-PF.

organization. See Rev. Rul. 75-38,

amount of subtitle A (income) tax for the

1975-1 C.B. 161, for a list of states with

Amended return. If you are amending

year reported on Form 1041 or Form

legislation that satisfies the requirements

Part VI, be sure to combine any tax due

1120. All other filers, enter zero.

of section 508(e).

that was paid with the original return (or

Line 5. Tax based on investment

any overpayment credited or refunded) in

However, if the state law does not

income. Subtract line 4 from line 3 and

the total for line 7. On the dotted line to

apply to a governing instrument that

enter the difference (but not less than

the left of the line 7 entry space, write

contains mandatory directions conflicting

zero) on line 5. Any overpayment entered

“Tax Paid w/ O.R.” and the amount paid.

with any of its requirements and the

on line 10 that is the result of a negative

If you had an overpayment, write “O.R.

organization has such mandatory

amount shown on line 5 will not be

Overpayment” and the amount credited or

directions in its governing instrument,

refunded. Unless the organization is a

refunded in brackets.

then the organization has not satisfied the

domestic section 4947(a)(1) nonexempt

If you file more than one amended

requirements of section 508(e) by the

charitable trust or taxable private

return, attach a schedule listing the tax

operation of that legislation.

foundation, the amount on line 5 is the

due amounts that were paid and

same as on line 1.

Line 8a. In the space provided list all

overpayment amounts that were credited

Line 6a. Enter the amount of 2010

states:

or refunded. Write “See Attachment” on

estimated tax payments and any 2009

the dotted line and enter the net amount

1. To which the organization reports in

overpayment of taxes that the

in the entry space for line 7.

any way about its organization, assets, or

organization specified on its 2009 return

activities; and

to be credited toward payment of 2010

Part VII-A. Statements

2. With which the organization has

estimated taxes.

registered (or which it has otherwise

Regarding Activities

notified in any manner) that it intends to

Line 6a applies only to domestic

Each question in this section must be

be, or is, a charitable organization or that

foundations.

answered “Yes,” “No,” or “N/A” (not

it is, or intends to be, a holder of property

CAUTION

applicable).

devoted to a charitable purpose.

Trust payments treated as

Line 1. “Political purposes” include, but

beneficiary payments. A trust may treat

are not limited to, directly or indirectly

Attach a separate list if you need more

any part of estimated taxes it paid as

accepting contributions or making

space.

taxes paid by the beneficiary. If the filing

payments to influence the selection,

Line 9. If the organization claims status

organization was a beneficiary that

nomination, election, or appointment of

as a private operating foundation for 2010

received the benefit of such a payment

any individual to any federal, state, or

and, in fact, meets the private operating

from a trust, include the amount on line

local public office or office in a political

foundation requirements for that year (as

6a of Part VI and write, “Includes section

organization, or the election of

reflected in Part XIV), any excess

643(g) payment.” See section 643(g) for

presidential or vice presidential electors,

distributions carryover from 2009 or prior

more information about estimated tax

whether or not the individual or electors

years may not be carried over to 2010 or

payments treated as paid by a

are actually selected, nominated, elected,

any year after 2010 even if it does not

beneficiary.

or appointed.

meet the private operating foundation

Line 3. A “conformed copy” of an

Line 6b. Exempt foreign foundations

requirements. See the instructions for

organizational document is one that

must enter the amount of tax withheld at

Part XIII.

agrees with the original document and all

the source. Attach Form 1042-S, Foreign

its amendments. If copies are not signed,

Person’s U.S. Source Income Subject to

Line 10. Substantial contributors. If

attach a written declaration signed by an

Withholding, or other form that verifies the

you answer “Yes,” attach a schedule

officer authorized to sign for the

withheld tax reported on line 6b (Form

listing the names and addresses of all

organization, certifying that they are

8288-A or Form 8805).

persons who became substantial

complete and accurate copies of the

contributors during the year.

Line 6d. Enter the amount of any

original documents.

backup withholding erroneously withheld.

The term “substantial contributor”

Note. If you are filing electronically, send

Recipients of interest or dividend

means any person whose contributions or

a conformed copy of the changes to the

payments must generally certify their

bequests during the current tax year and

IRS at the address listed in General

correct tax identification number to the

prior tax years total more than $5,000 and

Instruction U.

bank or other payer on Form W-9,

are more than 2% of the total

Request for Taxpayer Identification Line 6. For a private foundation to be

contributions and bequests received by

Number and Certification. If the payer exempt from income tax, its governing

the foundation from its creation through

does not get this information, it must instrument must include provisions that

the close of its tax year. In the case of a

withhold part of the payments as “backup require it to act or refrain from acting so

trust, the term “substantial contributor”

withholding.” If the organization files Form as not to engage in an act of self-dealing

also means the creator of the trust

990-PF and was subject to erroneous (section 4941) or subject the foundation

(section 507(d)(2)(A)).

backup withholding because the payer did to the taxes imposed by sections 4942

not realize the payee was an exempt (failure to distribute income), 4943 The term “person” includes individuals,

organization and not subject to this (excess business holdings), 4944 trusts, estates, partnerships, associations,

withholding, the organization can claim (investments which jeopardize charitable corporations, and other exempt

credit for the amount withheld. purpose), and 4945 (taxable organizations.

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Attached schedule for transfers from

Each contribution or bequest must be Enter the foundation’s website address

controlled entities. If at any time during

valued at fair market value on the date it if the foundation has a website.

the tax year, the foundation received any

was received. Otherwise, enter “N/A.”

transfers of funds or payments from a

Line 15. Section 4947(a)(1) trusts.

Any person who is a substantial

controlled entity within the meaning of

Section 4947(a)(1) nonexempt charitable

contributor on any date will remain a

section 512(b)(13), attach a schedule

trusts that file Form 990-PF instead of

substantial contributor for all later periods.

using the format provided in the sample

Form 1041 must complete this line. The

schedule on the next page. In column (c),

trust should include exempt-interest

However, a person will cease to be a

describe each transfer or payment

dividends received from a mutual fund or

substantial contributor with respect to any

received, including payment of interest,

other regulated investment company as

private foundation if:

annuities, royalties, rents, dividends, fees

well as tax-exempt interest received

1. The person, and all related

or other payments for services,

directly.

persons, made no contributions to the

contributions to capital, and loans. In

foundation during the 10-year period

Line 16. Foreign Accounts. Answer

column (d), enter the amount of each loan

ending with the close of the taxable year;

“Yes” if either (1) or (2) below applies.

or transfer from each controlled entity.

2. The person, or any related person,

1. At any time during the calendar

Line 12. Interest in insurance

was never the foundation’s manager

year ending with or within the foundation’s

contracts. Answer “Yes” if after August

during this 10-year period; and

tax year, the foundation had an interest

17, 2006, but before August 17, 2008, the

3. The aggregate contributions made

in, or signature or other authority over, a

foundation directly or indirectly acquired

by the person, and related persons, are

financial account in a foreign country

any applicable insurance contract that is a

determined by the IRS to be insignificant

(such as a bank account, securities

part of a structured transaction involving a

compared to the aggregate amount of

account, or other financial account); and

pool of such contracts. If you answer

contributions to the foundation by any

a. The combined value of all such

“Yes,” complete Form 8921.

other person and the appreciated value of

accounts was more than $10,000 at any

contributions held by the foundation.

time during the calendar year; and

An applicable insurance contract is

b. The accounts were not with a U.S.

any life insurance, annuity, or endowment

The term “related person” includes any

military banking facility operated by a U.S.

contract in which an applicable exempt

other person who would be a disqualified

financial institution.

organization and a person other than an

person because of a relationship with the

applicable exempt organization have

2. The foundation owns more than

substantial contributor (section 4946).

directly or indirectly held an interest in the

50% of the stock in any corporation that

When the substantial contributor is a

contract (whether or not at the same

would answer “Yes” to item 1 above.

corporation, the term also includes any

time). However, an applicable insurance

If “Yes,” file Form TD F 90-22.1, Report of

officer or director of the corporation. The

contract does not include any life

Foreign Bank and Financial Accounts, by

term “substantial contributor” does not

insurance, annuity, or endowment

June 30 after the end of the calendar year

include public charities (organizations

contract if:

with the Department of the Treasury at

described in section 509(a)(1), (2), or (3)).

1. All persons directly or indirectly

the address shown on the form. Do not

holding any interest in the contract (other

Line 11. Answer “Yes” if at any time

file Form TD F 90-22.1 with the IRS or

than applicable exempt organizations)

during the tax year the foundation owned

attach it to Form 990-PF.

have an insurable interest in the insured

a controlled entity. A controlled entity is

Form TD F 90-22.1 is available by

under the contract independent of any

an entity in which the foundation owns

calling 1-800-TAX-FORM

interest of an applicable exempt

more than 50% of the:

(1-800-829-3676) or by downloading it

organization in the contract, or

1. Stock (by vote or value) in a

from the IRS website at www.irs.gov/pub/

2. The sole interest in the contract of

corporation,

irs-pdf/f9022.pdf.

an applicable exempt organization or

2. Interest (of profit or capital) in a

each person other than an applicable

If you are required to file Form TD

partnership, or

exempt organization is as a named

F 90-22.1 but do not do so, you

3. Beneficial interest of any other

beneficiary, or

may have to pay a penalty of up to

CAUTION

entity.

3. The sole interest in the contract of

$10,000 (more in some cases).

each person other than an applicable

The foundation must apply section 318

Enter the name of each foreign country

exempt organization is:

in determining its ownership of stock in a

in which a foreign account described on

a. As a beneficiary of a trust holding

corporation and use similar principles in

line 16 is located.

an interest in the contract, but only if the

determining its ownership interests in

person’s designation as such beneficiary

other entities.

Part VII-B. Activities for

was made without consideration and

solely on a gratuitous basis, or

Attached schedule of controlled

Which Form 4720 May Be

b. As a trustee who holds an interest

entities. If at any time during the tax

in the contract in a fiduciary capacity

Required

year the foundation was the controlling

solely for the benefit of applicable

The purpose of these questions is to

organization of a controlled entity under

organizations or persons described above

determine if there is any initial excise tax

section 512(b)(13), attach a schedule

in 1, 2, or 3a. An applicable organization

due under sections 170(f)(10),

showing the name, address, and

is the foundation and any organization to

4941–4945, 4955, 4958, 4966, and 4967.

employer identification number of each

which contributions are deductible for

If the answer is “Yes” to question 1b, 1c,

controlled entity.

income tax, estate tax, or gift tax

2b, 3b, 4a, 4b, 5b, 6b, or 7b, complete

Attached schedule for transfers to

purposes and Indian tribal governments.

and file Form 4720 unless an exception

controlled entities. If at any time during

applies.

the tax year, the foundation made any Line 13. Public inspection

Line 1. Self-dealing. The activities listed

loans or transfers to a corporation, requirements and website address. All

in 1a(1)–(6) are considered self-dealing

partnership, or other entity, which it domestic private foundations (including

under section 4941 unless one of the

controlled within the meaning of section section 4947(a)(1) nonexempt charitable

exceptions applies. See www.irs.gov/

512(b)(13), attach a schedule using the trusts treated as private foundations) are

charities/foundations/article/

format provided in the sample schedule subject to the public inspection

0,,id=137700,00.html.

on the next page. In column (c), describe requirements. See General Instruction Q

each loan or transfer. In column (d), enter for information on making the foundation’s The terms “disqualified person” and

the amount for each loan or transfer to annual returns and exemption application “foundation manager” are defined in

each controlled entity. available for public inspection. General Instruction C.

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Line 11—Example A

Schedule of Information Regarding Transfers To a Controlled Entity

(A) (B) (C) (D)

Name and address of each controlled entity Employer Description of transfer Amount of

identification transfer

number

Total ..................................................................................

Line 11—Example B

Schedule of Information Regarding Transfers From a Controlled Entity

(A) (B) (C) (D)

Name and address of each controlled entity Employer Description of transfer Amount of

identification transfer

number

Total ................................................................................

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Line 1b. If you answered “Yes” to any of modified by Rev. Proc. 2009-32, 2009-28 understanding or expectation that any

the questions in 1a, you should answer I.R.B. 142, for more information. person will directly or indirectly pay these

“Yes” to 1b unless all of the acts engaged premiums.

A grant from a nonoperating

in were “excepted” acts. Excepted acts

foundation may be a taxable expenditure

Report the premiums it paid and the

are described in Regulations sections

if made to any other supporting

premiums paid by others, but treated as

53.4941(d)-3 and 4 or appear in Notices

organization (including a functionally

paid by the private foundation, on Form

published in the Internal Revenue Bulletin

integrated Type III), if a disqualified

8870 and pay the excise tax (which is

relating to disaster assistance.

person of the private foundation controls

equal to premiums paid) on Form 4720.

the supporting organization or any of its

Line 2b. Taxes on failure to distribute

For more information, see Form 8870

supported organizations. Check “Yes” on

income. If you answer “No” to question

and Notice 2000-24, 2000-17 I.R.B. 952

Line 5a(4) if you made such a grant. See

2b, attach a statement explaining:

(Notice 2000-24, 2000-1 C.B. 952).

Notice 2006-109, 2006-51 I.R.B. 1121, as

•

All the facts regarding the incorrect

Line 7a. Answer “Yes” if the foundation

modified by Rev. Proc. 2009-32, 2009-28

valuation of assets, and

was a party to a prohibited tax shelter

I.R.B. 142, for more information.

•

The actions taken (or planned) to

transaction (“PTST”) as described in

comply with section 4942(a)(2)(B), (C),

Under section 4955, a section

section 4965(e) at any time during the tax

and (D) and the related regulations.

501(c)(3) organization must pay an excise

year.

tax for any amount paid or incurred on

Line 3a. A private foundation is not

Prohibited tax shelter transaction. In

behalf of or opposing any candidate for

treated as having excess business

general, prohibited tax shelter transaction

public office. The organization must pay

holdings in any enterprise if, together with

means any listed transaction and any

an additional excise tax if it does not

related foundations, it owns 2% or less of

prohibited reportable transaction.

correct the expenditure timely.

the voting stock and 2% or less in value

Listed transaction. A listed transaction,

of all outstanding shares of all classes of A manager of a section 501(c)(3)

within the meaning of Code section

stock. (See “disqualified person” under organization who knowingly agrees to a

6707A(c)(2), is a transaction that is the

General Instruction C.) A similar political expenditure must pay an excise

same as, or substantially similar to, any

exception applies to a beneficial or profits tax unless the agreement is not willful and

transaction that has been specifically

interest in any business enterprise that is there is reasonable cause. A manager

identified by the Secretary in published

a trust or partnership. who does not agree to a correction of the

guidance as a tax avoidance transaction

political expenditure may have to pay an

For more information about excess

for purposes of Code section 6011.

additional excise tax.

business holdings, see the Instructions for

Prohibited reportable transaction.

A section 501(c)(3) organization will

Form 4720.

Prohibited reportable transaction means

lose its exempt status if it engages in

Line 4. Taxes on investments that

any confidential transaction or any

political activity.

jeopardize charitable purposes. In

transaction with contractual protection (as

A political expenditure that is treated

general, an investment that jeopardizes

defined under regulations prescribed by

as an expenditure under section 4955 is

any of the charitable purposes of a private

the Secretary) (see Regulations section

not treated as a taxable expenditure

foundation is one for which a foundation

1.6011-4(b)(3) and (4)) which is a

under section 4945.

manager did not exercise ordinary

reportable transaction (as defined in

For purposes of the section 4955 tax,

business care to provide for the long-and

section 6707A(c)(1)).

when an organization promotes a

short-term financial needs of the

If the answer to this question is

candidate for public office (or is used or

foundation in carrying out its charitable

“Yes,” the foundation must also file

controlled by a candidate or prospective

purposes. For more details, see the

Form 8886-T.

candidate), amounts paid or incurred for

regulations under section 4944.

Line 7b. Answer “Yes” if the foundation

the following purposes are political

Line 5. Taxes on taxable expenditures

answered “Yes” to 7a, and it had net

expenditures:

and political expenditures. In general,

income or received proceeds attributable

•

Remuneration to the individual (or

payments made for the activities

to the PTST during the tax year.

candidate or prospective candidate) for

described on lines 5a(1)–(5) are taxable

speeches or other services,

If the foundation answers “Yes” to

expenditures. Go to http://www.irs.gov/

•

Travel expenses of the individual,

both lines 7a and 7b, it may be required

charities/foundations/article/

•

Expenses of conducting polls, surveys,

to file Form 4720 and pay tax with respect

0,,id=137250,00.html.

or other studies, or preparing papers or

to each PTST. The foundation’s

Except as discussed below, a grant by

other material for use by the individual,

managers also may be required to file

a private foundation to a public charity is

•

Expenses of advertising, publicity, and

Form 4720 and pay tax with respect to

not a taxable expenditure if the private

fundraising for such individual, and

the relevant PTSTs.

foundation does not earmark the grant for

•

Any other expense that has the primary

any of the activities described in lines

effect of promoting public recognition or

Part VIII. Information

5a(1)–(5), and there is no oral or written

otherwise primarily accruing to the benefit

agreement by which the grantor

About Officers, Directors,

of the individual.

foundation may cause the grantee to

See the regulations under section

Trustees, Foundation

engage in any such prohibited activity or

4945 for more information.

to select the grant recipient.

Managers, Highly Paid

Line 5b. If you answered “Yes” to any of

Grants made to exempt operating

the questions in 5a, you should answer

Employees, and

foundations (as defined in section

“Yes” to 5b unless all of the transactions

Contractors

4940(d)(2) and the instructions to Part VI)

engaged in were “excepted” transactions.

are not subject to the expenditure

Excepted transactions are described in

Line 1. List of officers, directors,

responsibility provisions of section 4945.

Regulations section 53.4945 and appear

trustees, etc. List the names,

in Notices published in the Internal

A grant from a nonoperating addresses, and other information

Revenue Bulletin relating to disaster

foundation may be a taxable expenditure requested for those who were officers,

assistance. For example, see IRS Pub.

if made to a Type III supporting directors, and trustees (or any person

3833, Disaster Relief.

organization (as defined in 4943(f)(5)) who had responsibilities or powers similar

that is not a functionally integrated Line 6b. Check “Yes” if, in connection to those of officers, directors, or trustees)

supporting organization (as defined in with any transfer of funds to a private of the foundation at any time during the

4943(f)(5)(B)). Check “Yes” on Line 5a(4) foundation, the foundation directly or year. Each must be listed whether or not

if you made such a grant. See Notice indirectly pays premiums on any personal they receive any compensation from the

2006-109, 2006-51 I.R.B. 1121, as benefit contract, or there is an foundation. Give the address at which

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officers, etc., prefer the Internal Revenue de minimis fringe benefits described in maintains some significant involvement.

Service to contact them. section 132(e)). See Pub. 525, Taxable Related administrative expenses should

and Nontaxable Income, for more also be included. Examples of active

Also include on this list any officers or

information. Examples of allowances programs and definitions of the term

directors (or any person who had

include amounts for which the recipient “significant involvement” are provided in

responsibilities or powers similar to those

did not account to the organization or Regulations sections 53.4942(b)-1(b)(2)

of officers or directors) of a disregarded

allowances that were more than the and 53.4942(b)-1(d).

entity owned by the foundation who are

payee spent on serving the organization.

not officers, directors, etc., of the

Do not include any program-related

Include payments made in connection

foundation.

investments (reportable in Part IX-B) in

with indemnification arrangements, the

the description and expense totals, but be

If the foundation (or disregarded entity)

value of the personal use of housing,

sure to include qualified set-asides for

pays any other person, such as a

automobiles, or other assets owned or

direct charitable activities reported on line

management services company, for the

leased by the organization (or provided

3 of Part XII. Also, include in Part IX-A

services provided by any of the

for the organization’s use without charge).

amounts paid or set aside to acquire

foundation’s officers, directors, or trustees

Line 2. Compensation of five

assets used in the direct active conduct of

(or any person who had responsibilities or

highest-paid employees. Fill in the

charitable activities.

powers similar to those of officers,

information requested for the five

directors, or trustees), report the

Expenditures for direct charitable

employees (if any) of the foundation (or

compensation and other items on Part

activities include, among others, amounts

disregarded entity that the foundation

VIII as if you had paid the officers, etc.,

paid or set aside to:

owns) who received the greatest amount

directly. Also, see Announcement

1. Acquire or maintain the operating

of annual compensation over $50,000. Do

2001-33, 2001-17 I.R.B. 1137, 2001-1

assets of a museum, library, or historic

not include employees listed on line 1.

C.B. 1137.

site or to operate the facility;

Also enter the total number of other

Show all forms of compensation

2. Provide goods, shelter, or clothing

employees who received more than

earned by each listed officer, etc. In

to indigent or disaster victims if the

$50,000 in annual compensation.

addition to completing Part VIII, if you

foundation maintains some significant

Show each listed employee’s entire

want to explain the compensation of one

involvement in the activity rather than

compensation package for the period

or more officers, directors, and trustees,

merely making grants to the recipients;

covered by the return. Include all forms of

you may provide an attachment

3. Conduct educational conferences

compensation that each listed employee

describing the person’s entire 2010

and seminars;

received in return for his or her services.

compensation package.

4. Operate a home for the elderly or

See the line 1 instructions for more details

disabled;

Enter zero in columns (c), (d), and (e)

on includible compensation.

5. Conduct scientific, historic, public

if no compensation was paid. Attach a

Line 3. Five highest-paid independent

policy, or other research with significance

schedule if more space is needed.

contractors for professional services.

beyond the foundation’s grant program

Column (b). A numerical estimate of

Fill in the information requested for the

that does not constitute a prohibited

the average hours per week devoted to

five highest-paid independent contractors

attempt to influence legislation;

the position is required for the answer to

(if any), whether individuals or

6. Publish and disseminate the results

be considered complete.

professional service corporations or

of such research, reports of educational

associations, to whom the organization

Phrases such as “as needed” or

conferences, or similar educational

paid more than $50,000 for the year to

“as required” are unacceptable

material;

perform personal services of a

entries for column (b).

CAUTION

7. Support the service of foundation

professional nature for the organization

staff on boards or advisory committees of

Column (c). Enter salary, fees,

(for example, attorneys, accountants, and

other charitable organizations or on public

bonuses, and severance payments

doctors). Also show the total number of all

commissions or task forces;

received by each person listed. Include

other independent contractors who

8. Provide technical advice or

current year payments of amounts

received more than $50,000 for the year

assistance to a governmental body, a

reported or reportable as deferred

for performing professional services.

governmental committee, or subdivision

compensation in any prior year.

of either, in response to a written request

Column (d). Include all forms of

Part IX-A. Summary of

by the governmental body, committee, or

deferred compensation and future

subdivision;

Direct Charitable Activities

severance payments (whether or not

9. Conduct performing arts

funded or vested, and whether or not the

List the foundation’s four largest

performances; or

deferred compensation plan is a qualified

programs as measured by the direct and

10. Provide technical assistance to

plan under section 401(a)). Include

indirect expenses attributable to each that

grantees and other charitable

payments to welfare benefit plans

consist of the direct active conduct of

organizations. This assistance must have

(employee welfare benefit plans covered

charitable activities. Whether any

significance beyond the purposes of the

by Part I of Title 1 of ERISA, providing

expenditure is for the direct active

grants made to the grantees and must not

benefits such as medical, dental, life

conduct of a charitable activity is

consist merely of monitoring or advising

insurance, apprenticeship and training,

determined, generally, by the definitions

the grantees in their use of the grant

scholarship funds, severance pay,

and special rules of section 4942(j)(3) and

funds. Technical assistance involves the

disability, etc.) on behalf of the officers,

the related regulations, which define a

furnishing of expert advice and related

etc. Reasonable estimates may be used if

private operating foundation.

assistance regarding, for example:

precise cost figures are not readily

Except for significant involvement

a. Compliance with governmental

available.

grant programs, described below, do not

regulations,

include in Part IX-A any grants or

Unless the amounts are reported in

b. Reducing operating costs or

expenses attributable to administering

column (c), report, as deferred

increasing program accomplishments,

grant programs, such as reviewing grant

compensation in column (d), salaries and

c. Fundraising methods, and

applications, interviewing or testing

other compensation earned during the

d. Maintaining complete and accurate

applicants, selecting grantees, and

period covered by the return, but not yet

financial records.

reviewing reports relating to the use of the

paid by the date the foundation files its

grant funds.

return.

Report both direct and indirect

Column (e). Enter both taxable and Include scholarships, grants, or other expenses in the expense totals. Direct

nontaxable fringe benefits, expense payments to individuals as part of an expenses are those that can be

account and other allowances (other than active program in which the foundation specifically identified as connected with a

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particular activity. These include, among but may be grouped with other For example, an office building used to

others, compensation and travel program-related investments of the same provide offices for employees engaged in

expenses of employees and officers type. Loans to other section 501(c)(3) managing endowment funds for the

directly engaged in an activity, the cost of organizations and all other types of foundation is not considered an asset

materials and supplies utilized in program-related investments must be used for charitable purposes.

conducting the activity, and fees paid to listed separately on lines 1 through 3 or

Dual-use property. When property

outside firms and individuals in on an attachment.

is used both for charitable and other

connection with a specific activity.

Lines 1 and 2. List the two largest

purposes, the property is considered used

Indirect (overhead) expenses are

program-related investments made by the

entirely for charitable purposes if 95% or

those that are not specifically identified as

foundation in 2010, whether or not the

more of its total use is for that purpose. If

connected with a particular activity but

investments were still held by the

less than 95% of its total use is for

that relate to the direct costs incurred in

foundation at the end of the year.

charitable purposes, a reasonable

conducting the activity. Examples of

allocation must be made between

Line 3. Combine all other

indirect expenses include:

charitable and noncharitable use.

program-related investments and enter

•

Occupancy expenses;

the total on the line 3 Amount column. List

Excluded property. Certain assets

•

Supervisory and clerical compensation;

the individual investments or groups of

are excluded entirely from the

•

Repair, rental, and maintenance of

investments included (attach a schedule if

computation of the minimum investment

equipment;

necessary).

return. These include pledges of grants

•

Expenses of other departments or cost

and contributions to be received in the

The total of lines 1 through 3 in

centers (such as accounting, personnel,

future and future interests in estates and

the Amount column must equal

and payroll departments or units) that

trusts.

the amount reported on line 1b of

service the department or function that

TIP

Part XII.

incurs the direct expenses of conducting

Line 1a. Average monthly fair market

an activity; and

value of securities. If market quotations

•

Other applicable general and

Part X. Minimum

are readily available, a foundation may

administrative expenses, including the

use any reasonable method to determine

Investment Return

compensation of top management, to the

the average monthly fair market value of

extent reasonably allocable to a particular

Who must complete this section? All

securities such as common and preferred

activity.

domestic foundations must complete

stock, bonds, and mutual fund shares, as

Part X.

long as that method is consistently used.

No specific method of allocation is

For example, a value for a particular

required. The method used, however,

Foreign foundations that checked box

month might be determined by the closing

must be reasonable and must be used

D2 on page 1 do not have to complete

price on the first or last trading days of the

consistently.

Part X unless claiming status as a private

month or an average of the closing prices

operating foundation.

Examples of acceptable allocation

on the first and last trading days of the

methods include:

Private operating foundations

month. Market quotations are considered

•

Compensation allocated on a time

described in sections 4942(j)(3) or

readily available if a security is any of the

basis,

4942(j)(5) must complete Part X in order

following:

•

Employee benefits allocated on the

to complete Part XIV.

•

Listed on the New York or American

basis of direct salary expenses,

Overview. A private foundation that is

Stock Exchange or any city or regional

•

Travel, conference, and meeting

not a private operating foundation must

exchange in which quotations appear on

expenses charged directly to the activity

pay out, as qualifying distributions, its

a daily basis, including foreign securities

that incurred the expense,

minimum investment return. This is

listed on a recognized foreign national or

•

Occupancy expenses allocated on a

generally 5% of the total fair market value

regional exchange,

space-utilized basis, and

of its noncharitable assets, subject to

•

Regularly traded in the national or

•

Other indirect expenses allocated on

further adjustments as explained in the

regional over-the-counter market for

the basis of direct salary expenses or

instructions for Part XI. The amount of

which published quotations are

total direct expenses.

this minimum investment return is figured

available, or

in Part X and is used in Part XI to figure

•

Locally traded, for which quotations can

Part IX-B. Summary of

the amount required to be paid out (the

be readily obtained from established

distributable amount).

brokerage firms.

Program-Related

Minimum investment return. In figuring

If securities are held in trust for, or on

Investments

the minimum investment return, include

behalf of, a foundation by a bank or other

Program-related investment. Section

only those assets that are not actually

financial institution that values those

4944(c) and corresponding regulations

used or held for use by the organization

securities periodically using a computer

define a program-related investment as

for a charitable, educational, or other

pricing system, a foundation may use that

one that is made primarily to accomplish

similar function that contributed to the

system to determine the value of the

a charitable purpose of the foundation

charitable status of the foundation. Cash

securities. The system must be

and no substantial purpose of which is to

on hand and on deposit is considered

acceptable to the IRS for federal estate

produce investment income or a capital

used or held for use for charitable

tax purposes.

gain from the sale of the investment.

purposes only to the extent of the

The foundation may reduce the fair

Examples of program-related investments

reasonable cash balances reported in

market value of securities only to the

include educational loans to individuals

Part X, line 4. See the instructions for

extent that it can establish that the

and low-interest loans to other section

lines 1b and 4 below .

securities could only be liquidated in a

501(c)(3) organizations.

Assets held for the production of

reasonable period of time at a price less

General instructions. Include only

income or for investment are not

than the fair market value because of:

those investments that were reported in

considered to be used directly for

•

The size of the block of the securities,

Part XII, line 1b for the current year. Do

charitable functions even though the

•

The fact that the securities held are

not include any investments made in any

income from the assets is used for

securities in a closely held corporation, or

prior year even if they were still held by

charitable functions. It is a factual

•

The fact that the sale of the securities

the foundation at the end of 2010.

question whether an asset is held for the

would result in a forced or distress sale.

Investments consisting of loans to production of income or for investment

individuals (such as educational loans) rather than used or held for use directly Any reduction in value allowed under

are not required to be listed separately by the foundation for charitable purposes. these provisions may not be more than

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10% of the fair market value (determined determined on a 5-year basis by a percentage by dividing the number of

without regard to any reduction in value). certified, independent appraisal may be days in the short tax period by 365 (or

made as of any day in the first tax year of 366 in a leap year). Multiply the result by

Also, see Regulations sections

the foundation to which the valuation 5%. Then multiply the modified

53.4942(a)-2(c)(4)(i)(b), (c), and (iv)(a).

applies. percentage by the amount on line 5 and

Line 1b. Average of monthly cash

enter the result on line 6.

Assets held for less than a tax year.

balances. Compute cash balances on a

To determine the value of an asset held

monthly basis by averaging the amount of

Part XI. Distributable

less than 1 tax year, divide the number of

cash on hand on the first and last days of

days the foundation held the asset by the

each month. Include all cash balances

Amount

number of days in the tax year. Multiply

and amounts that may be used for

If the organization is claiming status as a

the result by the fair market value of the

charitable purposes (see line 4 below) or

private operating foundation described in

asset.

set aside and taken as a qualifying

section 4942(j)(3) or (j)(5) or if it is a

Line 1e. Reduction claimed for

distribution (see Part XII).

foreign foundation that checked box D2

blockage or other factors. If the fair

on page 1, check the box in the heading

Line 1c. Fair market value of all other

market value of any securities, real estate

for Part XI. You do not need to complete

assets. The fair market value of assets

holdings, or other assets reported on lines

this part. See the Part XIV instructions for

other than securities is determined

1a and 1c reflects a blockage discount,

more details on private operating

annually except as described below. The

marketability discount, or other reduction

foundations.

valuation may be made by private

from full fair market value because of the

foundation employees or by any other

Section 4942(j)(5) foundations are

size of the asset holding or any other

person even if that person is a

classified as private operating foundations

factor, enter on line 1e the aggregate

disqualified person. If the IRS accepts the

for purposes of section 4942 only if they

amount of the discounts claimed. Attach

valuation, it is valid only for the tax year

meet the requirements of Regulations

an explanation that includes the following

for which it is made. A new valuation is

section 53.4942(b)-1(a)(2).

information for each asset or group of

required for the next tax year.

assets involved:

The distributable amount for 2010 is

5-year valuation. A written, certified,

the amount that the foundation must

1. A description of the asset or asset

and independent appraisal of the fair

distribute by the end of 2011 as qualifying

group (for example, 20,000 shares of

market value of any real estate, including

distributions to avoid the 30% tax on the

XYZ, Inc., common stock),

any improvements, may be determined

undistributed portion.

2. For securities, the percentage of

on a 5-year basis by a qualified person.

the total issued and outstanding securities

Line 4. Enter the total of recoveries of

The qualified person may not be a

of the same class that is represented by

amounts treated as qualifying

disqualified person (see General

the foundation’s holding,

distributions for any year under section

Instruction C) with respect to the private

3. The fair market value of the asset

4942(g). Include recoveries of part or all

foundation or an employee of the

or asset group before any claimed

(as applicable) of grants previously made,

foundation.

blockage discount or other reduction,

proceeds from the sale or other

4. The amount of the discount

disposition of property whose cost was

Commonly accepted valuation

claimed, and

treated as a qualifying distribution when

methods must be used in making the

5. A statement that explains why the

the property was acquired, and any

appraisal. A valuation based on

claimed discount is appropriate in valuing

amount set aside under section 4942(g)

acceptable methods of valuing property

the asset or group of assets for section

to the extent it is determined that this

for federal estate tax purposes will be

4942 purposes.

amount is not necessary for the purposes

considered acceptable.

of the set-aside.

The appraisal must include a closing

In the case of securities, there are

Line 6. Deduction from distributable

statement that, in the appraiser’s opinion,

certain limitations on the size of the

amount. If the foundation was organized

the appraised assets were valued

reduction in value that can be claimed.

before May 27, 1969, and its governing

according to valuation principles regularly

See the instructions for Part X, line 1a.

instrument or any other instrument

employed in making appraisals of such

Line 2. Acquisition indebtedness.

continues to require the accumulation of

property, using all reasonable valuation

Enter the total acquisition indebtedness

income after a judicial proceeding to

methods. The foundation must keep a

that applies to assets included on line 1.

reform the instrument has terminated,

copy of the independent appraisal for its

For details, see section 514(c)(1).

then the income required to be

records. If a valuation is reasonable, the

Line 4. Cash deemed held for

accumulated must be subtracted from the

foundation may use it for the tax year for

charitable activities. Foundations may

distributable amount beginning with the

which the valuation is made and for each

exclude from the assets used in the

first tax year after the tax year in which

of the 4 following tax years.

minimum investment return computation

the judicial proceeding was terminated.

Any valuation of real estate by a

the reasonable cash balances necessary

(See the instructions for Part VII-A, line

certified independent appraisal may be

to cover current administrative expenses

6.)

replaced during the 5-year period by a

and other normal and current

subsequent 5-year certified independent

disbursements directly connected with the

Part XII. Qualifying

appraisal or by an annual valuation as

charitable, educational, or other similar

described above. The most recent

Distributions

activities. The amount of cash that may

valuation should be used to compute the

“Qualifying distributions” are amounts

be excluded is generally 1

% of the fair

foundation’s minimum investment return.

spent or set aside for religious,

market value of all assets (minus any

If the valuation is made according to

educational, or similar charitable

acquisition indebtedness) as computed in

the above rules, the IRS will continue to

purposes. The total amount of qualifying

Part X, line 3. However, if under the facts

accept it during the 5-year period for

distributions for any year is used to

and circumstances an amount larger than

which it applies even if the actual fair

reduce the distributable amount for

the deemed amount is necessary to pay

market value of the property changes

specified years to arrive at the

expenses and disbursements, then you

during the period.

undistributed income (if any) for

may enter the larger amount instead of

those years.

% of the fair market value on line 4. If

Valuation date. An asset required to

you use a larger amount, attach an

be valued annually may be valued as of Line 1a. Expenses, contributions, gifts,

explanation.

any day in the private foundation’s tax etc. Enter the amount from Part I, line

year, provided the foundation values the Line 6. Short tax periods. If the 26, column (d). However, if the borrowed

asset as of that date in all tax years. foundation’s tax period is less than 12 funds election applies, add the total of the

However, a valuation of real estate months, determine the applicable repayments during the year to the amount

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from Part I, line 26, column (d), and enter

•

The amounts and approximate dates of 2010 to satisfy elections. For example, if

it on line 1a. any planned additions to the set-aside undistributed income remained for any

after its initial establishment, year before 2009, it could be reduced to

Borrowed funds. If the foundation

•

The reasons why the project can be zero or, if the foundation wished, the

borrowed money in a tax year beginning

better accomplished by the set-aside than distributions could be treated as

before January 1, 1970, or later borrows

by the immediate payment of funds, distributions out of corpus.

money under a written commitment

•

A detailed description of the project, 3. If no elections are involved, apply

binding on December 31, 1969, the

including estimated costs, sources of any remaining qualifying distributions to the

foundation may elect to treat any

future funds expected to be used for 2010 distributable amount on line 4d. If

repayments of the loan principal after

completion of the project, and the the remaining qualifying distributions are

December 31, 1969, as qualifying

location(s) (general or specific) of any greater than the 2010 distributable

distributions at the time of repayment,

physical facilities to be acquired or amount, the excess is treated as a

rather than at the earlier time that the

constructed as part of the project, and distribution out of corpus on line 4e.

borrowed funds were actually distributed,

•

A statement of an appropriate

only if:

If for any reason the 2010 qualifying

foundation manager that the amounts set

1. The money is used to make

distributions do not reduce any 2009

aside will actually be paid for the specific

expenditures for a charitable or similar

undistributed income to zero, the amount

project within a specified period of time

purpose, and

not distributed is subject to a 30% tax. If

ending within 60 months after the date of

2. Repayment on the loan did not start

the 2009 income remains undistributed at

the first set-aside, or a statement

until a year beginning after 1969.

the end of 2011, it could be subject again

explaining why the period for paying the

to the 30% tax. Also, see section 4942(b)

amount set aside should be extended and

On these loans, deduct any interest

for the circumstances under which a

indicating the extension of time

payment from gross income to compute

second-tier tax could be imposed.

requested. (Include in this statement the

adjusted net income in the year paid.

reason why the proposed project could

Line 1. Distributable amount. Enter the

Election. To make this election,

not be divided into two or more projects

distributable amount for 2010 from Part

attach a statement to Form 990-PF for the

covering periods of no more than 60

XI, line 7.

first tax year beginning after 1969 in

months each.)

Line 2. Undistributed income. Enter

which a repayment of loan principal is

Set-aside under item 2. For any

the distributable amount for 2009 and

made and for each tax year after that in

set-aside under 2 above, the private

amounts for earlier years that remained

which any repayment of loan principal is

foundation must attach a schedule to its

undistributed at the beginning of the

made. The statement should show:

annual information return showing how

2010 tax year.

•

The lender’s name and address,

the requirements are met. A schedule is

Line 2b. Enter the amount of

•

The amount borrowed,

required for the year of the set-aside and

undistributed income for years before

•

The specific use of the borrowed funds,

for each subsequent year until the

2009.

and

set-aside amount has been distributed.

•

The private foundation’s election to

Line 3. Excess distributions carryover

See Regulations section

treat repayments of loan principal as

to 2010. If the foundation has made

53.4942(a)-3(b)(7)(ii) for specific

qualifying distributions.

excess distributions out of corpus in prior

requirements.

years, which have not been applied in any

Line 1b. Program-related investments.

Line 5. Reduced tax on investment

year, enter the amount for each year. Do

Enter the total of the “Amount” column

income under section 4940(e). If the

not enter an amount for a particular year if

from Part IX-B. See the Part IX-B

organization does not qualify for the 1%

the organization was a private operating

instructions for the definition of

tax under section 4940(e), enter zero.

foundation for any later year.

program-related investments.

See Parts V and VI of the instructions.

Lines 3a through 3e. Enter the amount

Line 3. Amounts set aside. Amounts

of any excess distribution made on the

set aside may be treated as qualifying

Part XIII. Undistributed

line for each year listed. Do not include

distributions only if the private foundation

any amount that was applied against the

Income

establishes to the satisfaction of the IRS

distributable amount of an earlier year or

that the amount will be paid for the

If you checked box D2 on page 1, do not

that was already used to meet

specific project within 60 months from the

fill in this part.

pass-through distribution requirements.

date of the first set-aside and meets 1 or

If the organization is a private

(See the instructions for line 7.)

2 below.

operating foundation for any of the years

Line 3f. This amount can be applied

1. The project can be better

shown in Part XIII, do not complete the

in 2010.

accomplished by a set-aside than by the

portions of Part XIII that apply to those

immediate payment of funds (suitability

years. If there are excess qualifying Line 4. Qualifying distributions. Enter

test).

distributions for any tax year, do not carry the total amount of qualifying distributions

2. The private foundation meets the

them over to a year in which the made in 2010 from Part XII, line 4. The

requirements of section 4942(g)(2)(B)(ii)

organization is a private operating total of the amounts applied on lines 4a

(cash distribution test).

foundation or to any later year. For through 4e is equal to the qualifying

example, if a foundation made excess distributions made in 2010.

Set-aside under item 1. For any

qualifying distributions in 2008 and

Line 4a. The qualifying distributions for

set-aside under 1 above, the private

became a private operating foundation in

2010 are first used to reduce any

foundation must apply for IRS approval by

2010, the excess qualifying distributions

undistributed income remaining from

the end of the tax year in which the

from 2008 could be applied against the

2009. Enter only enough of the 2010

amount is set aside. Send the application

distributable amount for 2009 but not to

qualifying distributions to reduce the 2009

for approval to the:

any year after 2009.

undistributed income to zero.

Internal Revenue Service

The purpose of this part is to enable

Lines 4b and 4c. If there are any 2010

TE/GE EO - Determinations

the foundation to comply with the rules for

qualifying distributions remaining after

P.O. Box 2508

applying its qualifying distributions for the

reducing the 2009 undistributed income to

Cincinnati, OH 45201

year 2010. In applying the qualifying

zero, one or more elections can be made

distributions, there are three basic steps.

The application for approval must give under Regulations section

all of the following information: 1. Reduce any undistributed income 53.4942(a)-3(d)(2) to apply all or part of

•

The nature and purposes of the specific for 2009 (but not below zero). the remaining qualifying distributions to

project and the amount of the set-aside 2. The organization may use any part any undistributed income remaining from

for which approval is requested, or all remaining qualifying distributions for years before 2009 or to apply to corpus.

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Line 8. Outdated excess distributions

Elections. To make these elections, Line 6f. In the 2010 column, enter the

carryover. Because of the 5-year

the organization must file a statement amount by which line 1 is more than the

carryover limitation under section

with the IRS or attach a statement, as total of lines 4d and 5. This is the

4942(i)(2), the organization must reduce

described in the above regulations undistributed income for 2010. The

any excess distributions carryover by any

section, to Form 990-PF. An election organization must distribute the amount

amounts from 2005 that were not applied

made by filing a separate statement with shown by the end of its 2011 tax year so

in 2010.

the IRS must be made within the year for that it will not be liable for the tax on

which the election is made. Otherwise, undistributed income.

Line 9. Excess distributions carryover

attach a statement to the Form 990-PF

to 2011. Enter the amount by which line

Line 7. Distributions out of corpus for

filed for the year the election was made.

6a is more than the total of lines 7 and 8.

2010 pass-through distributions.

This is the amount the organization may

Where to enter. If the organization

If the foundation is the donee and

apply to 2011 and following years. Line 9

elected to apply all or part of the

receives a contribution from another

can never be less than zero.

remaining amount to the undistributed

private foundation, the donor foundation

income remaining from years before

Line 10. Analysis of line 9. In the space

may treat the contribution as a qualifying

2009, enter the amount on line 4b.

provided for each year, enter the amount

distribution only if the donee foundation

of excess distributions carryover from that

If the organization elected to treat

makes a distribution equal to the full

year that has not been applied as of the

those qualifying distributions as a

amount of the contribution and the

end of the 2010 tax year. If there is an

distribution out of corpus, enter the

distribution is a qualifying distribution that

amount on the line for 2006, it must be

amount on line 4c.

is treated as a distribution of corpus. The

applied by the end of the 2011 tax year

donee foundation must, no later than the

Entering an amount on line 4b or

since the 5-year carryover period for 2006

close of the first tax year after the tax year

4c without submitting the required

ends in 2011.

in which it receives the contributions,

statement is not considered a

CAUTION

distribute an amount equal in value to the

valid election.

Part XIV. Private Operating

contributions received in the prior tax year

Line 4d. Treat as a distribution of the

Foundations

and have no remaining undistributed

distributable amount for 2010 any

income for the prior year. For example, if

All organizations that claim status as

qualifying distributions for 2010 that

private foundation X received $1,000 in

private operating foundations under

remain after reducing the 2009

tax year 2009 from foundation Y,

section 4942(j)(3) or (5) for 2010 must

undistributed income to zero and after

foundation X would have to distribute the

complete Part XIV.

electing to treat any part of the remaining

$1,000 as a qualifying distribution out of

Certain elderly care facilities (section

distributions as a distribution out of

corpus by the end of 2010 and have no

4942(j)(5)). For purposes of section

corpus or as a distribution of a prior year’s

remaining undistributed income for 2009.

4942 only, certain elderly care facilities

undistributed income. Enter only enough

may be classified as private operating

If a private foundation receives a

of the remaining 2010 qualifying

foundations. To be so classified, they

contribution from an individual or a

distributions to reduce the 2010

must be operated and maintained for the

corporation and the individual is seeking

distributable amount to zero.

principal purpose explained in section

the 50% contribution base limit on

Line 4e. Any 2010 qualifying

4942(j)(5) and also meet the endowment

deductions for the tax year (or the

distributions remaining after reducing the

test described below.

individual or corporation is not applying

2010 distributable amount to zero should

the limit imposed on deductions for

If the foundation is a section

be treated as an excess distribution out of

contributions to the foundation of capital

4942(j)(5) organization, complete only

corpus. This amount may be carried over

gain property), the foundation must

lines 1a, 1b, 2c, 2d, 2e, and 3b. Enter

and applied to later years.

comply with certain distribution

“N/A” on all other lines in the Total column

Line 5. Excess qualifying distributions

requirements.

for Part XIV.

carryover applied to 2010. Enter any

Private operating foundation (section

By the 15th day of the 3rd month after

excess qualifying distributions from line 3,

4942(j)(3)). The term “private operating

the end of the tax year in which the

which were applied to 2010, in both the

foundation” means any private foundation

foundation received the contributions, the

Corpus column and the 2010 column.

that spends at least 85% of the smaller of

donee foundation must distribute as

Apply the oldest excess qualifying

its adjusted net income or its minimum

qualifying distributions out of corpus:

distributions first. Thus, the organization

investment return directly for the active

will apply any excess qualifying

a. An amount equal to 100% of all

conduct of the exempt purpose or

distributions carried forward from 2005

contributions received during the year in

functions for which the foundation is

before those from later years.

order for the individual contributor to

organized and operated (the Income

Line 6a. Add lines 3f, 4c, and 4e.

receive the benefit of the 50% limit on

Test) and that also meets one of the three

Subtract line 5 from the total. Enter the

deductions, and

tests below.

net total in the Corpus column.

b. Distribute all contributions of

1. Assets test. 65% or more of the

Line 6c. Enter only the undistributed

property only so that the individual or

foundation’s assets are devoted directly

income from 2008 and prior years for

corporation making the contribution is not

to those activities or functionally related

which either a notice of deficiency under

subject to the section 170(e)(1)(B)(ii)

businesses, or both; or 65% or more of

section 6212(a) has been mailed for the

limitations.

the foundation’s assets are stock of a

section 4942(a) first-tier tax, or on which

corporation that is controlled by the

If the organization is applying excess

the first-tier tax has been assessed

foundation, and substantially all of the

distributions from prior years (for

because the organization filed a Form

assets of the corporation are devoted to

instance, any part of the amount in Part

4720 for a tax year that began before

those activities or functionally related

XIII, line 3f) to satisfy the distribution

2009.

businesses.

requirements of section 170(b)(1)(F) or

Lines 6d and 6e. These amounts are 2. Endowment test. The foundation

4942(g)(3), it must make the election

taxable under the provisions of section normally makes qualifying distributions

under Regulations section

4942(a), except for any part that is due directly for the active conduct of the

53.4942(a)-3(c)(2). Also, see Regulations

solely to improper valuation of assets to exempt purpose or functions for which it

section 1.170A-9(h)(2).

which the provisions of section 4942(a)(2) is organized and operated in an amount

are being applied (see Part VII-B, line 2b). Enter on line 7 the total distributions that is two-thirds or more of its minimum

Report the taxable amount on Form 4720. out of corpus made to satisfy the investment return.

If the exception applies, attach an restrictions on amounts received from 3. Support test. The foundation

explanation. donors described above. normally receives 85% or more of its

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support (other than gross investment award the organization makes. This identify any income reported in column

income as defined in section 509(e)) from information benefits the grant seeker and (b). In column (c), enter an exclusion

the public and from five or more exempt the foundation. The grant seekers will be code, from the list on page 31, to identify

organizations that are not described in aware of the grant eligibility requirements, any income reported in column (d). If

section 4946(a)(1)(H) with respect to and the foundation should receive only more than one exclusion code is

each other or the recipient foundation. applications that adhere to these grant applicable to a particular revenue item,

Not more than 25% of the support (other application requirements. select the lowest numbered exclusion

than gross investment income) normally code that applies. Also, if nontaxable

If the foundation only makes

may be received from any one of the revenues from several sources are

contributions to preselected charitable

exempt organizations and not more than reportable on the same line in column (d),

organizations and does not accept

one-half of the support normally may be use the exclusion code that applies to the

unsolicited applications for funds, check

received from gross investment income. largest revenue source.

the box on line 2.

Line 3. If necessary, attach a schedule Columns (b), (d), and (e). For amounts

See regulations under section 4942 for

for lines 3a and 3b that lists separately reported in Part XVI-A on lines 1–11,

the meaning of “directly for the active

amounts given to individuals and amounts enter in column (b) any income earned

conduct” of exempt activities for purposes

given to organizations. that is unrelated business income (see

of these tests.

section 512). In column (d), enter any

Purpose of grant or contribution.

Complying with these tests. A

income earned that is excluded from the

Entries under this column should reflect

foundation may meet the income test and

computation of unrelated business

the grant’s or contribution’s purpose and

either the assets, endowment, or support

taxable income by Code section 512, 513,

should be in greater detail than merely

test by satisfying the tests for any 3 years

or 514. In column (e), enter any related or

classifying them as charitable,

during a 4-year period consisting of the

exempt function income; that is, any

educational, religious, or scientific

tax year in question and the 3

income earned that is related to the

activities.

immediately preceding tax years. It may

organization’s purpose or function which

For example, use an identification

also meet the tests based on the total of

constitutes the basis for the organization’s

such as payments:

all related amounts of income or assets

exemption.

•

For nursing service,

held, received, or distributed during that

•

For fellowships, or

Also enter in column (e) any income

4-year period. A foundation may not use

•

For assistance to indigent families.

specifically excluded from gross income

one method for satisfying the income test

other than by Code section 512, 513, or

and another for satisfying one of the three

Entries such as “grant” or

514, such as interest on state and local

alternative tests. Thus, if a foundation

“contribution” under the column

bonds that is excluded from tax by section

meets the income test on the

titled Purpose of grant or

CAUTION

103. You must explain in Part XVI-B any

3-out-of-4-year basis for a particular tax

contribution are unacceptable.

amount shown in column (e).

year, it may not use the 4-year

Line 3a. Paid during year. List all

aggregation method for meeting one of

Comparing Part XVI-A with Part I. The

contributions, grants, etc., actually paid

the three alternative tests for that same

sum of the amounts entered on each line

during the year, including grants or

year.

of lines 1–11 of columns (b), (d), and (e)

contributions that are not qualifying

In completing line 3c(3) of Part XIV

of Part XVI-A should equal corresponding

distributions under section 4942(g).

under the aggregation method, the largest

amounts entered on Part I, lines 3–11,

Include current year payments of

amount of support from an exempt

column (a), and on line 5b as shown

set-asides treated as qualifying

organization will be based on the total

below:

distributions in the current tax year or any

amount received for the 4-year period

prior year.

Amounts in Correspond to

from any one exempt organization.

Part XVI-A Amounts in Part I,

Line 3b. Approved for future

on line . . . column (a), line . . .

A new private foundation must use the

payment. List all contributions, grants,

aggregation method to satisfy the tests for

etc., approved during the year but not

1a–g ............... 11

its first tax year in order to be treated as a

paid by the end of the year, including the

2 .................. 11

private operating foundation from the

unpaid portion of any current year

3 .................. 3

beginning of that year. It must continue to

set-aside.

4 .................. 4

use the aggregation method for its 2nd

5 and 6 .............. 5b (description

Because Form 990-PF is

and 3rd tax years to maintain its status for

column)

disclosed to the public, do not

those years.

7 .................. 11

report personal information about

CAUTION

8 .................. 6

grantees that is not required and could be

9 .................. 11 minus any special

Part XV. Supplementary

event expenses

used for identity theft purposes, such as a

included on lines 13

social security number, taxpayer

Information

through 23 of Part I,

identification number, or bank account

Complete this part only if the foundation

column (a)

information. See General Instruction Q for

10 ................. 10c

had assets of $5,000 or more at any time

more information about public inspection

11a–e .............. 11

during the year. This part does not apply

and disclosure requirements.

to a foreign foundation that during its

Line 1. Program service revenue. On

entire period of existence received

Part XVI-A. Analysis of

lines 1a–g, list each revenue-producing

substantially all (85% or more) of its

program service activity of the

support (other than gross investment

Income-Producing

organization. For each program service

income) from sources outside the

activity listed, enter the gross revenue

Activities

United States.

earned for each activity, as well as

In Part XVI-A, analyze revenue items that

Line 2. In the space provided (or in an

identifying business and exclusion codes,

are also entered in Part I, lines 3–11,

attachment, if necessary), furnish the

in the appropriate columns. For line 1g,

column (a), and on line 5b. Contributions

required information about the

enter amounts that are payments for

reported on line 1 of Part I are not entered

organization’s grant, scholarship,

services rendered to governmental units.

in Part XVI-A. For information on

fellowship, loan, etc., programs. In

Do not include governmental grants that

unrelated business income, see the

addition to restrictions or limitations on

are reportable on Part I, line 1.

Instructions for Form 990-T and Pub. 598.

awards by geographical areas, charitable

fields, and kinds of recipients, indicate Columns (a) and (c). In column (a), Report the total of lines 1a–g on line

any specific dollar limitations or other enter a 6-digit business code, from the list 11 of Part I, along with any other income

restrictions applicable to each type of in the Instructions for Form 990-T, to reportable on line 11.

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Program services are mainly those M reported admissions income in noncharitable exempt organization even if

activities that the reporting organization column (e) of Part XVI-A and explained in the transfer or transaction constitutes the

was created to conduct and that, along Part XVI-B that these performances are only connection with the noncharitable

with any activities begun later, form the the primary means by which it exempt organization.

basis of the organization’s current accomplishes its cultural and educational

Related organizations. If the

exemption from tax. purposes.

noncharitable exempt organization is

related to or affiliated with the reporting

Because M also reported interest from

Program services can also include the

organization, report all direct and indirect

state bonds in column (e) of Part XVI-A,

organization’s unrelated trade or business

transfers and transactions except for

M explained in Part XVI-B that such

activities. Program service revenue also

contributions and grants it received.

interest was excluded from gross income

includes income from program-related

by Code section 103.

Unrelated organizations. All

investments (such as interest earned on

transfers to an unrelated noncharitable

scholarship loans) as defined in the

Part XVII. Information

exempt organization must be reported on

instructions for Part IX-B.

line 1a. All transactions between the

Regarding Transfers To

Line 11. On lines 11a–e, list each

reporting organization and an unrelated

“Other revenue” activity not reported on

noncharitable exempt organization must

and Transactions and

lines 1 through 10. Report the sum of the

be shown on line 1b unless they meet the

amounts entered for lines 11a–e,

Relationships With

exception in the specific instructions for

columns (b), (d), and (e), on Part I, line

line 1b.

Noncharitable Exempt

11.

Line 1a. Transfers. Answer “Yes” to

Organizations

Line 13. On line 13, enter the total of

lines 1a(1) and 1a(2) if the reporting

columns (b), (d), and (e) of line 12.

Part XVII is used to report direct and

organization made any direct or indirect

indirect transfers to (line 1a) and direct

transfers of any value to a noncharitable

You may use the following worksheet

and indirect transactions with (line 1b)

exempt organization.

to verify your calculations.

and relationships with (line 2) any other

A “transfer” is any transaction or

Line 13, Part XVI-A ...........

noncharitable exempt organization. A

arrangement whereby one organization

“noncharitable exempt organization” is an

Minus: Part I, Line 5b .........

transfers something of value (cash, other

organization exempt under section 501(c)

Note: If Part I, line 5b,

assets, services, use of property, etc.) to

(that is not exempt under section

reflects a loss, add that

another organization without receiving

501(c)(3)), or a political organization

amount here instead of

something of more than nominal value in

described in section 527.

subtracting.

return. Contributions, gifts, and grants are

For purposes of these instructions, the

examples of transfers.

Plus: Part I, Line 1 ..........

section 501(c)(3) organization completing

If the only transfers between the two

Plus: Part I, Line 5a, .........

Part XVII is referred to as the “reporting

organizations were contributions and

organization.”

Plus: Expenses of special events

grants made by the noncharitable exempt

A noncharitable exempt organization is

deducted in computing Part

organization to the reporting organization,

“related to or affiliated with” the reporting

XVI-A, line 9 ..........

answer “No.”

organization if either:

Line 1b. Other transactions. Answer

Equal: Part I, Line 12, column (a)

•

The two organizations share some

“Yes” for any transaction described on

element of common control, or

line 1b(1)–(6), regardless of its amount, if

•

A historic and continuing relationship

it is with a related or affiliated

Part XVI-B. Relationship of

exists between the two organizations.

organization.

A noncharitable exempt organization is

Activities to the

Unrelated organizations. Answer

unrelated to the reporting organization if:

“Yes” for any transaction between the

Accomplishment of

•

The two organizations share no

reporting organization and an unrelated

element of common control, and

noncharitable exempt organization,

Exempt Purposes

•

A historic and continuing relationship

regardless of its amount, if the reporting

To explain how each amount in column

does not exist between the two

organization received less than adequate

(e) of Part XVI-A was related or exempt

organizations.

consideration. There is adequate

function income, show the line number of

An “element of common control” is

consideration when the fair market value

the amount in column (e) and give a brief

present when one or more of the officers,

of the goods and other assets or services

description of how each activity reported

directors, or trustees of one organization

furnished by the reporting organization is

in column (e) contributed importantly to

are elected or appointed by the officers,

not more than the fair market value of the

the accomplishment of the organization’s

directors, trustees, or members of the

goods and other assets or services

exempt purposes (other than by providing

other. An element of common control is

received from the unrelated noncharitable

funds for such purposes). Activities that

also present when more than 25% of the

exempt organization. The exception

generate exempt-function income are

officers, directors, or trustees of one

described below does not apply to

activities that form the basis of the

organization serve as officers, directors,

transactions for less than adequate

organization’s exemption from tax.

or trustees of the other organization.

consideration.

Also, explain any income entered in

A “historic and continuing relationship”

Answer “Yes” for any transaction

column (e) that is specifically excluded

exists when two organizations participate

between the reporting organization and

from gross income other than by Code

in a joint effort to achieve one or more

an unrelated noncharitable exempt

section 512, 513, or 514. If no amount is

common purposes on a continuous or

organization if the “amount involved” is

entered in column (e), do not complete

recurring basis rather than on the basis of

more than $500. The “amount involved” is

Part XVI-B.

one or more isolated transactions or

the fair market value of the goods,

activities. Such a relationship also exists

services, or other assets furnished by the

Example. M, a performing arts

when two organizations share facilities,

reporting organization.

association, is primarily supported by

equipment, or paid personnel during the

endowment funds. It raises revenue by Exception. If a transaction with an

year, regardless of the length of time the

charging admissions to its performances. unrelated noncharitable exempt

arrangement is in effect.

These performances are the primary organization was for adequate

means by which the organization Line 1. Reporting of certain transfers consideration and the amount involved

accomplishes its cultural and educational and transactions. Generally, report on was $500 or less, answer “No” for that

purposes. line 1 any transfer to or transaction with a transaction.

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Form 990-PF Instructions

Page 30 of 32 Instructions for Form 990-PF 13:37 - 29-NOV-2010

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Line 1b(3). Answer “Yes” for identify the organization on line 2 even if

•

Sign it in the space provided for the

transactions in which the reporting neither factor is present at the end of preparer’s signature (a facsimile signature

organization was either the lessor or the the year. is acceptable), and

lessee.

•

Give the organization a copy of the

Do not enter unrelated noncharitable

return in addition to the copy to be filed

Line 1b(4). Answer “Yes” if either

exempt organizations on line 2 even if

with the IRS.

organization reimbursed expenses

transfers to or transactions with those

incurred by the other.

organizations were entered on line 1. For

Paperwork Reduction Act Notice. We

example, if a one-time transfer to an

Line 1b(5). Answer “Yes” if either

ask for the information on this form to

unrelated noncharitable exempt

organization made loans to the other or if

carry out the Internal Revenue laws of the

organization was entered on line 1a(2),

the reporting organization guaranteed the

United States. You are required to give us

do not enter the organization on line 2.

other’s loans.

the information. We need it to ensure that

Line 1b(6). Answer “Yes” if either

Column (b). Enter the exempt

you are complying with these laws and to

organization performed services or

category of the organization; for example,

allow us to figure and collect the right

membership or fundraising solicitations

“501(c)(4).”

amount of tax.

for the other.

Column (c). In most cases, a simple

You are not required to provide the

Line 1c. Complete line 1c regardless of

description, such as “common directors”

information requested on a form that is

whether the noncharitable exempt

or “auxiliary of reporting organization” will

subject to the Paperwork Reduction Act

organization is related to or closely

be sufficient. If you need more space,

unless the form displays a valid OMB

affiliated with the reporting organization.

write “see attached” in column (c) and use

control number. Books or records relating

For purposes of this line, “facilities”

an attached sheet to describe the

to a form or its instructions must be

includes office space and any other land,

relationship. If you are entering more than

retained as long as their contents may

building, or structure whether owned or

one organization on line 2, identify which

become material in the administration of

leased by, or provided free of charge to,

organization you are describing on the

any Internal Revenue law. The rules

the reporting organization or the

attached sheet.

governing the confidentiality of Form

noncharitable exempt organization.

990-PF are covered in Code section

Line 1d. Use this schedule to describe

Signature

6104.

the transfers and transactions for which

The return must be signed by the

“Yes” was entered on lines 1a–c above.

The time needed to complete and file

president, vice president, treasurer,

You must describe each transfer or

this form will vary depending on individual

assistant treasurer, chief accounting

transaction for which the answer was

circumstances. The estimated average

officer, or other corporate officer (such as

“Yes.” You may combine all of the cash

time is:

tax officer) who is authorized to sign. A

transfers (line 1a(1)) to each organization

receiver, trustee, or assignee must sign

Recordkeeping ........ 140 hr., 37 min.

into a single entry. Otherwise, make a

any return that he or she is required to file

separate entry for each transfer or

Learning about the law or

for a corporation. If the return is filed for a

transaction.

the form ............. 28 hr., 15 min.

trust, it must be signed by the authorized

Column (a). For each entry, enter the

trustee or trustees. Sign and date the

line number from line 1a–c. For example,

Preparing the form ...... 33 hr., 39 min.

form and fill in the signer’s title.

if the answer was “Yes” to line 1b(3),

If an officer or employee of the

Copying, assembling, and

enter “b(3)” in column (a).

organization prepares the return, the Paid

sending the form to the IRS 32 min.

Column (d). If you need more space,

Preparer Use Only area should remain

write “see attached” in column (d) and

blank. If someone prepares the return

If you have comments concerning the

use an attached sheet for the description.

without charge, that person should not

accuracy of these time estimates or

If making more than one entry on line 1d,

sign the return.

suggestions for making this form simpler,

specify on the attached sheet which

we would be happy to hear from you. You

Generally, anyone who is paid to

transfer or transaction you are describing.

can write to the Internal Revenue Service,

prepare the organization’s tax return must

Line 2. Reporting of certain

Tax Products Coordinating Committee,

sign the return and fill in the Paid

relationships. Enter on line 2 each

SE:W:CAR:MP:T:T:SP, 1111 Constitution

Preparer Use Only area. If you have

noncharitable exempt organization that

Ave. NW, IR-6526, Washington, DC

questions about whether a preparer is

the reporting organization is related to or

20224. Do not send the tax form to this

required to sign the return, please contact

affiliated with, as defined above. If the

address. Instead, see When, Where, and

an IRS office.

control factor or the historic and

How To File on page 5.

continuing relationship factor (or both) is The paid preparer must complete the

present at any time during the year, required preparer information and:

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Form 990-PF Instructions

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EPS File Name: 11290y5 Size: Width = 44.0 picas, Depth = 58.0 picas

Exclusion Codes

Real property rental income that does not

depend on the income or profits derived

by the person leasing the property and is

excluded by section 512 (b)(3)

16—

General Exceptions Debt-Financed Income

Income exempt from debt-financed

(section 514) provisions because at least

85% of the use of the property is for the

organization’s exempt purposes. (Note:

This code is only for income from the

15% or less non-exempt purpose use.)

(section 514(b)(1)(A))

Income from an activity that is not

regularly carried on (section 512(a)(1))

01— 30—

Income from an activity in which labor is

a material income-producing factor and

substantially all (at least 85%) of the work

is performed with unpaid labor (section

513(a)(1))

02—

17— Rent from personal property leased with

real property and incidental (10% or less)

in relation to the combined income from

the real and personal property (section

512(b)(3))

Gross income from mortgaged property

used in research activities described in

section 512(b)(7), (8), or (9) (section

514(b)(1)(C))

31—

Section 501(c)(3) organization— Income

from an activity carried on primarily for

the convenience of the organization’s

members, students, patients, visitors,

officers, or employees (hospital parking

lot or museum cafeteria, for example)

(section 513(a)(2))

03—

18— Gain or loss from the sale of investments

and other non-inventory property and

from certain property acquired from

financial institutions that are in

conservatorship or receivership (sections

512(b)(5) and (16)(A))

19— Gain or loss from the lapse or termination

of options to buy or sell securities or real

property, and on options and from the

forfeiture of good-faith deposits for the

purchase, sale, or lease of investment real

estate (section 512(b)(5))

Gross income from mortgaged property

used in any activity described in section

513(a)(1), (2), or (3) (section 514(b)(1)(D))

32—

20— Income from research for the United

States; its agencies or instrumentalities;

or any state or political subdivision

(section 512(b)(7))

Section 501(c)(4) local association of

employees organized before May 27,

1969— Income from the sale of

work-related clothes or equipment and

items normally sold through vending

machines; food dispensing facilities; or

snack bars for the convenience of

association members at their usual places

of employment (section 513(a)(2))

04— Income from mortgaged property

(neighborhood land) acquired for exempt

purpose use within 10 years (section

514(b)(3))

33—

21— Income from research conducted by a

college, university, or hospital (section

512(b)(8))

Income from mortgaged property

acquired by bequest or devise (applies to

income received within 10 years from the

date of acquisition) (section 514(c)(2)(B))

34—

22— Income from research conducted by an

organization whose primary activity is

conducting fundamental research, the

results of which are freely available to the

general public (section 512(b)(9))

Income from the sale of merchandise,

substantially all of which (at least 85%)

was donated to the organization (section

513(a)(3))

05—

Income from mortgaged property

acquired by gift where the mortgage was

placed on the property more than 5 years

previously and the property was held by

the donor for more than 5 years (applies

to income received within 10 years from

the date of gift (section 514(c)(2)(B))

35—

23— Income from services provided under

license issued by a federal regulatory

agency and conducted by a religious

order or school operated by a religious

order, but only if the trade or business

has been carried on by the organization

since before May 27, 1959 (section 512

(b)(15))

Specific Exceptions

Section 501(c)(3), (4), or (5) organization

conducting an agricultural or educational

fair or exposition— Qualified public

entertainment activity income (section

513(d)(2))

06— Income from property received in return

for the obligation to pay an annuity

described in section 514(c)(5)

36—

Income from mortgaged property that

provides housing to low and moderate

income persons, to the extent the

mortgage is insured by the Federal

Housing Administration (section 514(c)(6)).

(Note: In many cases, this would be

exempt function income reportable in

column (e). It would not be so in the case

of a section 501(c)(5) or (6) organization,

for example, that acquired the housing as

an investment or as a charitable activity.)

37—

Foreign Organizations

Section 501(c)(3), (4), (5), or (6)

organization—Qualified convention and

trade show activity income (section

513(d)(3))

07—

Foreign organizations only—Income from

a trade or business NOT conducted in the

United States and NOT derived from

United States sources (patrons) (section

512(a)(2))

24—

Income from hospital services described

in section 513(e)

08—

Income from noncommercial bingo games

that do not violate state or local law

(section 513(f))

09—

Social Clubs and VEBAs

Section 501(c)(7), (9), or (17)

organization—Non-exempt function

income set aside for a charitable, etc.,

purpose specified in section 170(c)(4)

(section 512(a)(3)(B)(i))

25—

Income from games of chance conducted

by an organization in North Dakota

(section 311 of the Deficit Reduction Act

of 1984, as amended)

10—

Income from mortgaged real property

owned by: a school described in section

170(b)(1)(A)(ii); a section 509(a)(3) affiliated

support organization of such a school; a

section 501(c)(25) organization; or by a

partnership in which any of the above

organizations owns an interest if the

requirements of section 514(c)(9)(B)(vi) are

met (section 514(c)(9))

38—

Section 501(c)(7), (9), or (17)

organization—Proceeds from the sale of

exempt function property that was or will

be timely reinvested in similar property

(section 512(a)(3)(D))

26—

Section 501(c)(12) organization— Qualified

pole rental income (section 513(g)) and/or

member income (described in section

501(c)(12)(H))

11—

Income from the distribution of low-cost

articles in connection with the solicitation

of charitable contributions (section 513(h))

12—

Section 501(c)(9) or (17) organization—

Nonfunction income set aside for the

payment of life, sick, accident, or

other benefits (section 512(a)(3)(B)(ii))

27—

Special Rules

Income from the exchange or rental of

membership or donor list with an

organization eligible to receive charitable

contributions by a section 501(c)(3)

organization; by a war veterans’

organization; or an auxiliary unit or society

of, or trust or foundation for, a war

veterans’ post or organization (section

513(h))

13—

Section 501(c)(5) organization—Farm

income used to finance the operation and

maintenance of a retirement home,

hospital, or similar facility operated by the

organization for its members on property

adjacent to the farm land (section

1951(b)(8)(B) of Public Law 94-455)

39—

Veterans’ Organizations

Section 501(c)(19) organization—

Payments for life, sick, accident, or health

insurance for members or their

dependents that are set aside for the

payment of such insurance benefits or for

a charitable, etc., purpose specified in

section 170(c)(4) (section 512(a)(4))

28—

Trade or Business

41— Gross income from an unrelated activity

that is regularly carried on but, in light of

continuous losses sustained over a

number of tax periods, cannot be

regarded as being conducted with the

motive to make a profit (not a trade or

business)

Modifications and Exclusions

Dividends, interest, payments with

respect to securities loans, annuities,

income from notional principal contracts,

other substantially similar income from

ordinary and routine investments, and

loan commitment fees, excluded by

section 512(b)(1)

14—

Section 501(c)(19) organization— Income

from an insurance set-aside (see code 28

above) that is set aside for payment of

insurance benefits or for a charitable, etc.,

purpose specified in section 170(c)(4)

(Regs. 1.512(a)–4(b)(2))

29—

Royalty income excluded by section

512(b)(2)

15—

Annual dues, not exceeding $146 (subject

to inflation), paid to a section 501(c)(5)

agricultural or horticultural organization

(section 512(d))

40—

Other

Receipt of qualified sponsorship

payments described in section 513(i)

42—

Exclusion of any gain or loss from the

qualified sale, exchange, or other

disposition of any qualifying brownfield

property (section 512(b)(19))

43—

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Index

A Private operating Gross investment income ..... 11 Public inspection ............. 20

foundation ................ 3 Relief ....................... 9

Accounting methods ........... 5 Gross profit .................. 13

Program-related

Accounting period ............. 5 Gross receipts ................. 6

investment ............... 24

Adjusted net income .......... 11

Qualifying distributions ...... 25

Amended return ............ 5, 19

Qualifying distributions ....... 12,

Significant disposition ........ 9

Amended returns, state ........ 5

13, 25

Income test .................. 27

Substantial contraction ...... 9

Amounts set aside .......... 26

Annual return:

Taxable private Incomplete return:

Amended ................... 5

Qualifying distributions (see the

foundation ................ 3 How to avoid ................ 2

Copies to state officials ...... 5

instructions for Part XII for an

Penalties ................... 6

Depository methods:

Extension for filing ........... 5

explanation of qualifying

Electronic deposit ........... 6 Inventory ..................... 13

Failure to file timely or

distributions) for any

Depreciation ................. 14

completely ................ 6

year. ...................... 13

Disqualified person ............ 3

Purpose of form ............. 2

Disregarded entity .......... 2, 23

State reporting

Large organization ............. 6

Dissolution .................... 9

requirements .............. 4

Liquidation .................... 9

Rounding .................... 10

Termination ................ 10 Distributable amount .......... 25

When to file ................. 5

Where to file ................ 5

Minimum investment

Which parts to complete ..... 2

Schedule B (Form 990, 990–EZ,

EFTPS ....................... 6

return ...................... 24

Assets test ................... 27

or 990–PF) ................ 12

Elections .............. 18, 26, 27

Short tax year .............. 25

Attachments ................. 10

Self-dealing .................. 20

Electronic deposit ............. 6

Signature .................... 30

Endowment test .............. 27

Significant disposition .......... 9

Estimated tax ................. 6

Net investment income .... 11, 15

Significant involvement ....... 23

Bank account ................ 20

Penalty ..................... 6

Business meals ............ 14

Special payment option ........ 7

Business meals .............. 14

Excise tax based on investment

Noncharitable exempt

State reporting

income:

organization ................ 29

requirements ................ 4

Domestic exempt private

Nonexempt charitable trust ..... 3,

Amended returns ............ 5

foundations .............. 18

Capital gains and losses:

6, 20

Substantial contraction ......... 9

Domestic taxable private

Basis ...................... 17

Nonoperating private

foundations and section

Substantial contributor ........ 19

Gains ...................... 17

foundation ........... 3, 12, 13

4947(a)(1) nonexempt

Support test .................. 27

Losses .................... 18

charitable trusts .......... 18

Charitable donation:

Foreign organizations ....... 18

Substantiation of ........... 12

Exempt operating foundation

Other expenses .............. 14

Children ...................... 1

Tax payment methods:

qualification ................ 18

Contributions ................. 15

Special payment option ...... 7

Extension for filing ............. 5

Copy of old return ............. 6

Taxable private foundation ..... 3,

Penalties:

Currency ..................... 10

Against responsible

Termination ................ 9, 11

Failure to file timely or person .................... 6

Annual return .............. 10

completely .................. 6 Estimated tax ............... 6

Special rules ........... 10, 30

Definitions .................... 3

Failure to disclose quid pro quo

Failure to pay tax when due .... 6

Travel ....................... 14

Disqualified person .......... 3

contributions ............. 13

Filing extension ............... 5

Distributable amount ........ 25

Failure to file timely or

Financial account ............. 20

Foundation manager ........ 3

completely ................ 6

Foreign ...................... 20

Gross investment

When to file ................... 5

Failure to pay timely ......... 6

Accounts .................. 20

income .................. 11

Extension ................... 5

Photographs of missing

Foreign organizations ...... 9, 10,

Net investment income ..... 11

Where to file .................. 5

children ..................... 1

Noncharitable exempt

Which parts to complete ....... 2

Private foundation ............. 3

Foundation manager ........... 3

organization ............. 29

Who must file ................. 2

Private operating

Nonexempt charitable

foundation ........... 3, 11, 27

trust ...................... 3

■

Program services ............. 29

Nonoperating private

Gifts ......................... 15

Program-related

foundation ................ 3

Grants ....................... 15

investment ............. 24, 26

Private foundation ........... 3

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