Internal Revenue Bulletin: 2004-19
May 10, 2004
Net investment income of private foundation. This notice announces that the Treasury Department and the Service intend to propose regulations modifying regulations section 53.4940-1(d)(2) to provide that a private foundation’s net investment income for purposes of section 4940 of the Code does not include distributions from trusts and estates and that until further guidance is promulgated, income distributions from trusts and estates will not retain their character in the hands of a distributee private foundation for purposes of determining the foundation’s net investment income under section 4940(c). This notice also provides instructions on how a private foundation should fill out its applicable returns and how to claim refunds.
Distributable amount of a private foundation. This notice states that the Treasury Department and the Service intend to propose regulations modifying regulations under section 4942 of the Code in a manner consistent with the holding of the Tax Court and the Ninth Circuit in Ann Jackson Family Foundation. It also states that until further guidance is promulgated, private foundations should compute the distributable amount under section 4942(d) without regard to regulations section 53.4942(a)-2(b)(2). Accordingly, income distributions received from section 4947(a)(2) trusts are not included in a private foundation’s distributable amount for purposes of section 4942. The notice also includes instructions for filling out the private foundation’s applicable information and excise tax returns and how to claim a refund pursuant to this notice.
A list is provided of organizations now classified as private foundations.
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