

IR-2004-81, June 22, 2004
[Note: Because of its length, this text is in short Web pages, following the outline below. Items without separate links are with the text before or after them, as appropriate. No text is omitted. To download or print the entire testimony, please use the (487K)PDF.]
Written Statement of Mark W. Everson, Commissioner of Internal Revenue,
before the Committee on Finance, U.S. Senate:
Hearing on Charitable Giving Problems and Best Practices

INTRODUCTION
	 


DETERRENCE OF ABUSES WITHIN TAX-EXEMPT ORGANIZATIONS AND GOVERNMENT ENTITIES

The Need for Enhanced Governance

Specific Examples of Failures in Governance and the IRS Response

Credit Counseling Organizations


Compensation Issues


Terrorist Financing and Charities




Enhancing Governance – The Need for Better Coordination with the States and with Other Federal Agencies

Coordination with States


Coordination with Other Federal Agencies



Enhancing Governance – The Need for More Outreach
		 



DETERRENCE OF THIRD PARTY MISUSE OF TAX-EXEMPT AND GOVERNMENT ENTITIES

Abuse Involving Tax-exempt Accommodation Parties

Offsetting Foreign Currency Option Contracts


The S Corporation Transaction


Problems the IRS Faces in Addressing This Area

Disclosure


Lack of Sanction



IRS Response to Accommodation Party Strategies



Misuse of Tax-Exempt Entities by Donors and Investors

Section 509(a)(3) supporting organizations


Corporations Sole


Donor Advised Funds


Certain Employee Stock Ownership Plans (ESOPs)



In-Kind Donations to Charities—the Problem of Overvaluation and Other Issues

Intellectual Property


Conservation Easements


Vehicle Donations
			 




CONCLUSION

 
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