Joint Ventures Involving Tax-Exempt Organizations
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9780470148082, 047014808X
1039099736
Joint Ventures Involving Tax-Exempt Organizations
About the Author
Contents
Acknowledgments
Preface
Chapter 1: Introduction: Joint Ventures Involving Exempt Organizations Generally
1.1 INTRODUCTION
1.2 JOINT VENTURES IN GENERAL
1.3 HEALTHCARE JOINT VENTURES
1.4 UNIVERSITY JOINT VENTURES
1.5 LOW-INCOME HOUSING JOINT VENTURES
1.6 CONSERVATION JOINT VENTURES
1.7 JOINT VENTURES AS ACCOMODATING PARTIES TO IMPERMISSIBLE TAX SHELTERS
1.8 JOINT VENTURE STRUCTURE
1.9 THE EXEMPT ORGANIZATION IN A JOINT VENTURE: REV. RUL. 98-15
1.10 ANCILLARY JOINT VENTURES: REV. RUL. 2004-51
1.11 THE EXEMPT ORGANIZATION AS LIMITED PARTNER OR NON-MANAGING MEMBER
1.12 PARTNERSHIPS WITH OTHER EXEMPT ORGANIZATIONS
1.13 TRANSFER OF CONTROL OF SUPPORTING ORGANIZATION TO ANOTHER TAX-EXEMPT ORGANIZATION
1.14 THE EXEMPT ORGANIZATION AS A LENDER OR GROUND LESSOR
1.15 PARTNERSHIP TAXATION
1.16 UBIT IMPLICATIONS FROM PARTNERSHIP ACTIVITIES
1.17 USE OF A SUBSIDIARY AS PARTICIPANT IN A JOINT VENTURE
1.18 LIMITATION ON PREFERRED RETURNS
1.19 SHARING STAFF AND/OR FACILITIES: SHARED SERVICES AGREEMENT
1.20 " INTANGIBLES" LICENSED BY NONPROFIT TO FOR-PROFIT SUBSIDIARY OR JOINT VENTURE
1.21 PRIVATE INUREMENT AND PRIVATE BENEFIT
1.22 LIMITATION ON PRIVATE FOUNDATION'S ACTIVITIES THAT LIMIT EXCESS BUSINESS HOLDINGS
1.23 INTERNATIONAL JOINT VENTURES
1.24 OTHER DEVELOPMENTS
Chapter 2: Taxation of Charitable Organizations
2.1 INTRODUCTION
2.2 CATEGORIES OF EXEMPT ORGANIZATIONS
2.3 SECTION 501(C) ORGANIZATIONS: STRUCTURAL ELEMENTS
2.4 STATUTORY REQUIREMENTS
2.5 GENERAL REQUIREMENTS
2.6 CHARITABLE ORGANIZATIONS
2.7 STRUCTURE OF THE IRS
2.8 APPLICATION FOR EXEMPTION
2.9 REPORTING REQUIREMENTS
2.10 THE IRS AUDIT
2.11 CHARITABLE CONTRIBUTIONS
2.12 CAR DONATION PROGRAMS. 2.13 SARBANES-OXLEY AND EXEMPT ORGANIZATIONS
2.14 STATE LAWS
Chapter 3: Taxation of Partnerships and Joint Ventures
3.1 SCOPE OF CHAPTER
3.2 QUALIFYING AS A PARTNERSHIP
3.3 CLASSIFICATION AS PARTNERSHIP
3.4 ALTERNATIVES TO PARTNERSHIPS
3.5 PASS-THROUGH REGIME: THE CONDUIT CONCEPT
3.6 ALLOCATION OF PROFITS, LOSSES, AND CREDITS
3.7 FORMATION OF PARTNERSHIP
3.8 TAX BASIS IN PARTNERSHIP INTERESTS
3.9 PARTNERSHIP OPERATIONS
3.10 PARTNERSHIP DISTRIBUTIONS TO PARTNERS
3.11 SALE OR OTHER DISPOSITION OF ASSETS OR INTERESTS
3.12 OTHER TAX ISSUES
Chapter 4: Overview: Joint Ventures Involving Exempt Organizations
4.1 INTRODUCTION
4.2 EXEMPT ORGANIZATION AS GENERAL PARTNER: A HISTORICAL PERSPECTIVE
4.3 EXEMPT ORGANIZATIONS AS LIMITED PARTNER OR LLC NON-MANAGING MEMBER
4.4 JOINT VENTURES WITH OTHER EXEMPT ORGANIZATIONS
4.5 NEW SCHEME FOR ANALYZING JOINT VENTURES
4.6 REVENUE RULING 2004-51 AND ANCILLARY JOINT VENTURES
4.7 UBIT IMPLICATIONS FROM JOINT VENTURE ACTIVITIES
4.8 USE OF A SUBSIDIARY AS PARTICIPANT IN A JOINT VENTURE
4.9 USE OF A SUPPORTING ORGANIZATION IN A JOINT VENTURE
4.10 THE IRS AUDIT
4.11 CONVERSIONS FROM EXEMPT TO FOR-PROFIT AND FROM FOR-PROFIT TO EXEMPT ENTITIES
4.12 EXEMPT ORGANIZATION AS LENDER OR GROUND LESSOR
4.13 ISSUANCE OF TAX-EXEMPT BONDS
4.14 REPORTING REQUIREMENTS
Appendix 4A: Joint Venture Checklist
Chapter 5: Private Benefit, Private Inurement, and Excess Benefit Transactions
5.1 WHAT ARE PRIVATE INUREMENT AND PRIVATE BENEFIT?
5.2 TRANSACTIONS IN WHICH PRIVATE BENEFIT OR INUREMENT MAY OCCUR
5.3 PROFIT-MAKING ACTIVITIES AS INDICIA OF NONEXEMPT PURPOSE
5.4 INTERMEDIATE SANCTIONS
5.5 CASE LAW
5.6 PLANNING
5.7 STATE ACTIVITY WITH RESPECT TO INSIDER TRANSACTIONS
Chapter 6: The Exempt Organization as Lender or Ground Lessor. 6.1 OVERVIEW
6.2 A PARTICIPATION AS A LENDER OR GROUND LESSOR
6.3 TYPES OF REAL ESTATE LOANS
6.4 PARTICIPATING LOANS
6.5 GROUND LEASE WITH LEASEHOLD MORTGAGE
6.6 SALE OF UNDEVELOPED LAND
6.7 GUARANTEES
6.8 CONCLUSION
Chapter 7: Exempt Organizations as Accommodating Parties in Tax Shelter Transactions
7.1 INTRODUCTION
7.2 PREVENTION OF ABUSIVE TAX SHELTERS
7.3 EXCISE TAXES AND PENALTIES
7.4 SETTLEMENT INITIATIVES
7.5 ABUSIVE SHELTERS AND TAX CREDIT PROGRAMS
Chapter 8: The Unrelated Business Income Tax
8.1 INTRODUCTION
8.2 HISTORICAL AND LEGISLATIVE BACKGROUND OF UBIT
8.3 GENERAL RULE
8.4 STATUTORY EXCEPTIONS TO UBIT
8.5 MODIFICATIONS TO UBIT
8.6 INCOME FROM PARTNERSHIPS
8.7 CALCULATION OF UBIT
8.8 GOVERNMENTAL SCRUTINY AND LEGISLATIVE INITIATIVES
Chapter 9: Debt-Financed Income
9.1 INTRODUCTION
9.2 DEBT-FINANCED PROPERTY
9.3 THE 514(C)(9) EXCEPTION
9.4 PARTNERSHIP RULES
9.5 THE FRACTIONS RULE
9.6 THE FINAL REGULATION
9.7 THE FRACTIONS RULE: A TRAP FOR THE UNWARY
Chapter 10: Limitation on Excess Business Holdings
10.1 INTRODUCTION
10.2 EXCESS BUSINESS HOLDINGS: GENERAL RULES
10.3 TAX IMPOSED
10.4 EXCLUSIONS
Chapter 11: Impact on Taxable Joint Ventures: Tax-Exempt Entity Leasing Rules
11.1 INTRODUCTION
11.2 TYPES OF TRANSACTIONS COVERED BY 1984 ACT RULES
11.3 INTERNAL REVENUE CODE 168(H)
11.4 TAX-EXEMPT USE PROPERTY
11.5 RESTRICTIONS ON TAX-EXEMPT USE PROPERTY
11.6 PARTNERSHIP RULES
Chapter 12: Healthcare Entities in Joint Ventures
12.1 OVERVIEW OF ECONOMICS
12.2 CLASSIFICATIONS OF JOINT VENTURES
12.3 TAX ANALYSIS
12.4 OTHER HEALTHCARE INDUSTRY ISSUES
12.5 PRESERVING THE 50/50 JOINT VENTURE
12.6 VALUATION
12.7 JOINT OPERATING AGREEMENTS
12.8 UBIT IMPLICATIONS OF HOSPITAL JOINT VENTURES. 17.1 OVERVIEW
17.2 DOMESTIC CHARITIES EXPENDING FUNDS ABROAD
17.3 POTENTIAL FOR ABUSE: THE USE OF CHARITIES AS ACCOMMODATING PARTIES IN INTERNATIONAL TERRORIST ACTIVITIES
17.4 GUIDELINES FOR U.S.-BASED CHARITIES ENGAGING IN INTERNATIONAL AID AND INTERNATIONAL CHARITIES
17.5 GENERAL GRANT-MAKING RULES
17.6 FOREIGN ORGANIZATIONS RECOGNIZED BY THE IRS AS 501(c)(3) ORGANIZATIONS
17.7 PUBLIC CHARITY EQUIVALENCY TEST
17.8 EXPENDITURE RESPONSIBILITY
17.9 DOMESTIC CHARITIES ENTERING INTO JOINT VENTURES WITH FOREIGN ORGANIZATIONS
17.10 APPLICATION OF FOREIGN LAWS IN OPERATING A JOINT VENTURE IN A FOREIGN COUNTRY
17.11 APPLICATION OF FOREIGN TAX TREATIES
17.12 CURRENT DEVELOPMENTS IN CROSS-BORDER CHARITABLE ACTIVITIES
17.13 CONCLUSIONS AND FORECAST
Chapter 18: Private Pension Fund Investments in Joint Ventures
18.1 OVERVIEW
18.2 PRIVATE PENSION FUND PARTICIPATION IN JOINT VENTURES
18.3 CONCLUSION
Chapter 19: Exempt Organizations Investing Through Limited Liability Companies
19.1 INTRODUCTION
19.2 THE BASICS OF LLCS: STATE AND FEDERAL INCOME TAX LAW
19.3 COMPARISON WITH OTHER BUSINESS ENTITIES
19.4 BACKGROUND AND DEVELOPMENT OF LLCS
19.5 TAX CLASSIFICATION OF LLCS UNDER CHECK-THE-BOX REGULATIONS45
19.6 EXEMPT ORGANIZATIONS WHOLLY OWNING OTHER ENTITIES
19.7 IRS ANALYSIS: THE DOUBLE-PRONG TEST AND REV. RUL. 98-15
19.8 NONPROFIT-SPONSORED LIHTC PROJECT
19.9 PRIVATE FOUNDATIONS AS MEMBERS OF LLCS
Chapter 20: Debt Restructuring and Asset Protection Issues
20.1 INTRODUCTION
20.2 OVERVIEW OF BANKRUPTCY
20.3 AUTOMATIC STAY
20.4 CHAPTER 11 PLAN OF REORGANIZATION
20.5 DISCHARGE
20.6 SPECIAL ISSUES: USE OF CASH
20.7 SPECIAL ISSUES: CONSEQUENCES OF DEBT REDUCTION
Index