When a private foundation makes a grant to a foreign organization, special rules apply. For example, grants for charitable purposes to foreign organizations generally may be treated as a qualifying distribution and not a taxable expenditure if the private foundation makes a good faith determination that the foreign organization is the equivalent of a public charity. Currently, a determination is considered as made in good faith if it is based on an affidavit of the foreign organization or an opinion of counsel. The proposed regulations modify this rule to identify a broader class of tax practitioners upon whose written advice a private foundation may base a good faith determination to include a ”qualified tax practitioner”; defined as an attorney, a certified public accountant (“CPA”), or an enrolled agent.
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Proposed regulations regarding foreign grants
- Bryan Cave LLP
- Keith J. Kehrer
- USA
- October 1 2012
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Philip I. Weis
Senior Corporate Counsel
Pfizer