Source: https://irc.bloombergtax.com/public/uscode/doc/irc/section_4940
Timestamp: 2019-10-22 23:33:33
Document Index: 404202908

Matched Legal Cases: ['§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940', '§ 4940']

Internal Revenue Code, § 4940. Excise Tax Based On Investment Income
§ 4940
I.R.C. § 4940(a) Tax-Exempt Foundations —
I.R.C. § 4940(b) Taxable Foundations —
I.R.C. § 4940(b)(1) —
I.R.C. § 4940(b)(2) —
I.R.C. § 4940(c) Net Investment Income Defined
I.R.C. § 4940(c)(1) In General —
I.R.C. § 4940(c)(2) Gross Investment Income —
I.R.C. § 4940(c)(3) Deductions
I.R.C. § 4940(c)(3)(A) In General —
I.R.C. § 4940(c)(3)(B) Modifications —
I.R.C. § 4940(c)(3)(B)(i) —
I.R.C. § 4940(c)(3)(B)(ii) —
I.R.C. § 4940(c)(4) Capital Gains And Losses —
I.R.C. § 4940(c)(4)(A) —
I.R.C. § 4940(c)(4)(B) —
I.R.C. § 4940(c)(4)(C) —
I.R.C. § 4940(c)(4)(D) —
I.R.C. § 4940(c)(5) Tax-Exempt Income —
I.R.C. § 4940(d) Exemption For Certain Operating Foundations
I.R.C. § 4940(d)(1) In General —
I.R.C. § 4940(d)(2) Exempt Operating Foundation —
I.R.C. § 4940(d)(2)(A) —
I.R.C. § 4940(d)(2)(B) —
I.R.C. § 4940(d)(2)(C) —
I.R.C. § 4940(d)(2)(C)(i) —
I.R.C. § 4940(d)(2)(C)(ii) —
I.R.C. § 4940(d)(2)(D) —
I.R.C. § 4940(d)(3) Definitions —
I.R.C. § 4940(d)(3)(A) Publicly Supported —
I.R.C. § 4940(d)(3)(B) Disqualified Individual —
I.R.C. § 4940(d)(3)(B)(i) —
I.R.C. § 4940(d)(3)(B)(ii) —
I.R.C. § 4940(d)(3)(B)(ii)(I) —
I.R.C. § 4940(d)(3)(B)(ii)(II) —
I.R.C. § 4940(d)(3)(B)(ii)(III) —
the beneficial interest of a trust or unincorporated enterprise, which is a substantial contributor to the foundation, or
I.R.C. § 4940(d)(3)(B)(iii) —
I.R.C. § 4940(d)(3)(C) Substantial Contributor —
I.R.C. § 4940(d)(3)(D) Family —
I.R.C. § 4940(d)(3)(E) Constructive Ownership —
I.R.C. § 4940(e) Reduction In Tax Where Private Foundation Meets Certain Distribution Requirements
I.R.C. § 4940(e)(1) In General —
I.R.C. § 4940(e)(2) Requirements —
I.R.C. § 4940(e)(2)(A) —
the amount of the qualifying distributions made by the private foundation during such taxable year equals or exceeds the sum of--
I.R.C. § 4940(e)(2)(A)(i) —
I.R.C. § 4940(e)(2)(A)(ii) —
I.R.C. § 4940(e)(2)(B) —
I.R.C. § 4940(e)(3) Average Percentage Payout For Base Period —
I.R.C. § 4940(e)(3)(A) In General —
I.R.C. § 4940(e)(3)(B) Percentage Payout —
I.R.C. § 4940(e)(3)(B)(i) —
I.R.C. § 4940(e)(3)(B)(ii) —
I.R.C. § 4940(e)(3)(C) Special Rule Where Tax Reduced Under This Subsection —
I.R.C. § 4940(e)(4) Base Period —
I.R.C. § 4940(e)(4)(A) In General —
I.R.C. § 4940(e)(4)(B) New Private Foundations, Etc. —
I.R.C. § 4940(e)(5) Other Definitions —
I.R.C. § 4940(e)(5)(A) Qualifying Distribution —
I.R.C. § 4940(e)(5)(B) Assets —
I.R.C. § 4940(e)(6) Treatment Of Successor Organizations, Etc. —
I.R.C. § 4940(e)(6)(A) —
I.R.C. § 4940(e)(6)(B) —
(Added Pub. L. 91-172, title I, 101(b), Dec. 30, 1969, 83 Stat. 498, and amended Pub. L. 94-455, title XIX, 1901(b)(33)(N), Oct. 4, 1976, 90 Stat. 1802; Pub. L. 95-345, 2(a)(4), Aug. 15, 1978, 92 Stat. 481; Pub. L. 95-600, title V, 520(a), Nov. 6, 1978, 92 Stat. 2884; Pub. L. 98-369, div. A, title III, 302(a), 303(a), July 18, 1984, 98 Stat. 779, 781; Pub. L. 99-514, title XIII, 1301(j)(6), title XVIII, 1832, Oct. 22, 1986, 100 Stat. 2658, 2851; Pub. L. 109-280, title XII, Sec. 1221, Aug. 17, 2006, 120 Stat. 780; Pub. L. 110-172, Sec. 3(f), Dec. 29, 2007, 121 Stat. 2473.)
1987--Pub. L. 100-203, title X, 10712(c)(7), (9), Dec. 22, 1987, 101 Stat. 1330-467, substituted in chapter heading “AND CERTAIN OTHER TAX-EXEMPT ORGANIZATIONS" for “BLACK LUNG BENEFIT TRUSTS”, struck out item for subchapter C “Abatement of first and second tier taxes in certain cases”, and added items for subchapters C and D.
1984--Pub. L. 98-369, div. A, title III, 305(b)(3), July 18, 1984, 98 Stat. 784, substituted “Abatement of first and second tier taxes in certain cases" for “Abatement of second tier taxes where there is correction during correction period” in item for subchapter C.
1980--Pub. L. 96-596, 2(c)(3), Dec. 24, 1980, 94 Stat. 3474, added item for subchapter C.
1978--Pub. L. 95-227, 4(c)(2)(A), Feb. 10, 1978, 92 Stat. 22, in chapter heading inserted “;BLACK LUNG BENEFIT TRUSTS” after “FOUNDATIONS”, and added items for subchapters A and B.
1969--Pub. L. 91-172, title I, 101(b), Dec. 30, 1969, 83 Stat. 498, added chapter heading “PRIVATE FOUNDATIONS”.
1978--Pub. L. 95-227, 4(c)(2)(A), Feb. 10, 1978, 92 Stat. 22, added subchapter A heading and designated sections 4940 to 4948 as subchapter A.
1969--Pub. L. 91-172, title I, 101(b), Dec. 30, 1969, 83 Stat. 498, added analysis of sections.
2007 - Subsec. (c)(4)(A). Pub. L. 110-172, Sec. 3(f), amended subpar. (A). Before amendment, it read as follows:
“(A) There shall be taken into account only gains and losses from the sale or other disposition of property used for the production of gross investment income (as defined in paragraph (2)), and property used for the production of income included in computing the tax imposed by section 511 (except to the extent gain or loss from the sale or other disposition of such property is taken into account for purposes of such tax).”
2006 - Subsec. (c)(2). Pub. L. 109-280, Sec. 1221(a)(1), amended par. (2) by adding the sentence at the end.
Subsec. (c)(4)(A). Pub. L. 109-280, Sec. 1221(b)(1), amended subpar. (A) by substituting “used for the production of gross investment income (as defined in paragraph (2))” for “used for the production of interest, dividends, rents, and royalties”.
Subsec. (c)(4)(C). Pub. L. 109-280, Sec. 1221(b)(2), amended subpar. (C) by inserting “or carrybacks” after “carryovers”.
Subsec. (c)(4))(D). Pub. L. 109-280, Sec. 1221(b)(3), added subpar. (D).
1986--Subsec. (c)(5). Pub. L. 99-514, 1301(j), substituted “(relating to State and local bonds)" for “(relating to interest on certain governmental obligations)”.
Subsec. (e)(2). Pub. L. 99-514, 1832, added subpar. (B) and struck out former subpar. (B) and concluding provision which read as follows:
In the case of an operating foundation (as defined in section 4942(j)(3)), subparagraph (B) shall be applied by substituting ‘3-1/3 percent’ for ‘5 percent’.”
1984--Subsec. (d). Pub. L. 98-369, 302(a), added subsec. (d).
Subsec. (e). Pub. L. 98-369, 303(a), added subsec. (e).
1978--Subsec. (a). Pub. L. 95-600 substituted “2 percent” for “4 percent”.
Subsec. (c)(2). Pub. L. 95-345 inserted provision relating to payments with respect to securities loans.
1976--Subsec. (c). Pub. L. 94-455 substituted “capital gain net income” for “net capital gain" in par. (1) after “investment income and the”, and in par. (4) after “par. (1) in determining”.
Amendment by section 3(f) of Pub. L. 110-172 effective as if included in the provisions of the Pension Protection Act of 2006 [Pub. L. 109-280, Sec. 1221] to which it relates.
Amendments by section 1221 of Pub. L. 109-280 applicable to taxable years beginning on or after the date of the enactment of this Act [Enacted: Aug. 17, 2006].
Amendment by section 1301(j)(6) of Pub. L. 99-514 applicable to bonds issued after Aug. 15, 1986, except as otherwise provided, see sections 1311 to 1318 of Pub. L. 99-514, set out as an Effective Date; Transitional Rules note under section 141 of this title.
Amendment by section 1832 of Pub. L. 99-514 effective, except as otherwise provided, as if included in the provisions of the Tax Reform Act of 1984, Pub. L. 98-369, div. A, to which such amendment relates, see section 1881 of Pub. L. 99-514, set out as a note under section 48 of this title.
Section 302(c)(1) of Pub. L. 98-369 provided that: “The amendment made by subsection (a) [amending this section] shall apply to taxable years beginning after December 31, 1984.”
Section 303(b) of Pub. L. 98-369 provided that: “The amendment made by subsection (a) [amending this section] shall apply to taxable years beginning after December 31, 1984.”
Section 520(b) of Pub. L. 95-600 provided that: “The amendment made by the first section of this Act [probably meaning section 520(a), which amended this section] shall apply to taxable years beginning after September 30, 1977.”
Section 101(k) of Pub. L. 91-172, as amended by Pub. L. 99-514, 2, Oct. 22, 1986, 100 Stat. 2095, provided:
“(1) In general.--Except as otherwise provided in this subsection and subsection (l) [set out as a note below] the amendments made by this section [enacting sections 507, 508, 509, 4940, 4941, 4942, 4943, 4944, 4945, 4946, 4947, 4848, 6056, 6684, and 6685 of this title, amending sections 101, 170, 501, 503, 542, 663, 681, 878, 884, 1443, 2039, 2517, 4057, 4221, 4253, 4294, 5214, 6033, 6034, 6043, 6104, 6161, 6201, 6211, 6212, 6213, 6214, 6344, 6501, 6503, 6511, 6512, 6601, 6652, 6653, 6659, 6676, 6677, 6679, 6682, 7207, 7422, and 7454 of this title, repealing section 504 of this title, and enacting provisions set out as notes under sections 1 and 4940 of this title] shall take effect on January 1, 1970.
“(2) Provisions effective for taxable years beginning after december 31, 1969.--The following provisions shall apply to taxable years beginning after December 31, 1969:
“(A) Sections 4940, 4942, 4943, and 4948 of the Internal Revenue Code of 1986 [formerly I.R.C. 1954 ] (as added by this section), and
“(3) Sections 508(a), (b), and (c).--Sections 508 (a),(b), and (c) of the Internal Revenue Code of 1986 (as added by this section) shall take effect on October 9, 1969.”
Section 101(l) of Pub. L. 91-172 as amended by Pub. L. 93-490, 4(a), Oct. 26, 1974, 88 Stat. 1467; Pub. L. 94-455, title XIII, 1301(a), 1309(a), Oct. 4, 1976, 90 Stat. 1713, 1729; Pub. L. 95-600, title VII, 703(f), Nov. 6, 1978, 92 Stat. 2940; Pub. L. 98-369, div. A, title III, 314(b)(1), July 18, 1984, 98 Stat. 787; Pub. L. 99-514, 2, Oct. 22, 1986, 100 Stat. 2095, provided that:
“(1) References to internal revenue code provisions.--Except as otherwise expressly provided, references in the following paragraphs of this subsection are to sections of the Internal Revenue Code of 1986 [formerly I.R.C. 1954 ] as amended by this section.
“(2) Section 4941.--Section 4941 shall not apply to--
“(C) the leasing of property or the lending of money or other extension of credit between a disqualified person and a private foundation pursuant to a binding contract in effect on October 9, 1969 (or pursuant to renewals of such a contract), until taxable years beginning after December 31, 1979, if such leasing or lending (or other extension of credit) remains at least as favorable as an arm's-length transaction with an unrelated party and if the execution of such contract was not at the time of such execution a prohibited transaction (within the meaning of section 503(b) or the corresponding provisions of prior law);
“(F) the sale, exchange, or other disposition (other than by lease) of property which is owned by a private foundation to a disqualified person if--
“(3) Section 4942.--In the case of organizations organized before May 27, 1969, section 4942 shall--
“(A) for all purposes other than the determination of the minimum investment return under section 4942(j)(3)(B)(ii), for taxable years beginning before January 1, 1972, apply without regard to section 4942(e) (relating to minimum investment return), and for taxable years beginning in 1972, 1973, and 1974, apply with an applicable percentage (as prescribed in section 4942(e)(3)) which does not exceed 4-1/2 percent, 5 percent, and 5-1/2 percent, respectively;
“(B) not apply to an organization to the extent its income is required to be accumulated pursuant to the mandatory terms (as in effect on May 26, 1969, and at all times thereafter) of an instrument executed before May 27, 1969, with respect to the transfer of income producing property to such organization, except that section 4942 shall apply to such organization if the organization would have been denied exemption if section 504(a) had not been repealed by this Act, or would have had its deductions under section 642(c) limited if section 681(c) had not been repealed by this Act. In applying the preceding sentence, in addition to the limitations contained in section 504(a) or 681(c) before its repeal, section 504(a)(1) or 681(c)(1) shall be treated as not applying to an organization to the extent its income is required to be accumulated pursuant to the mandatory terms (as in effect on January 1, 1951, and at all times thereafter) of an instrument executed before January 1, 1951, with respect to the transfer of income producing property to such organization before such date, if such transfer was irrevocable on such date;
“(4) Section 4943.--
“(A) In the case of a private foundation--
“(iii) which acquired such stock solely by gift, devise, or bequest, section 4943(c)(4)(A)(i) shall be applied with respect to the holdings of such foundation in such incorporated business enterprise as if it did not contain the phrase ‘,but in no event shall the percentage so substituted be more than 50 percent’, and section 4943(c)(4)(D) shall not apply with respect to such holdings. For purposes of the preceding sentence, stock of such enterprise in a trust created before May 27, 1969, of which the foundation is the remainder beneficiary shall be deemed to be held by such foundation on May 26, 1969, if such foundation held (without regard to such trust) more than 20 percent of the stock of such enterprise on May 26, 1969.
“(B) Subparagraph (A) shall apply to a private foundation only if--
“(5) Section 4945.--Section 4945(d)(4) and (h) shall not apply to a grant which is described in paragraph (3)(C) of this subsection.
“(6) Section 508(e).--Section 508(e) shall not apply to require inclusion in governing instruments of any provisions inconsistent with this subsection.
“(7) Section 509(a).--In the case of any trust created under the terms of a will or a codicil to a will executed on or before March 30, 1924, by which the testator bequeathed all of the outstanding common stock of a corporation in trust, the income of which trust is to be used principally for the benefit of those from time to time employed by the corporation and their families, the trustees of which trust are elected or selected from among the employees of such corporation, and which trust does not own directly any stock in any other corporation, if the trust makes an irrevocable election under this paragraph within one year after the date of the enactment of this Act [Dec. 30, 1969], such trust shall be treated as not being a private foundation for purposes of the Internal Revenue Code of 1986 but shall be treated for purposes of such Code as if it were not exempt from tax under section 501(a) for any taxable year beginning after the date of the enactment of this Act [Dec. 30, 1969] and before the date (if any) on which such trust has complied with the requirements of section 507 for termination of the status of an organization as a private foundation.
“(8) Certain redemptions.--For purposes of applying section 302(b)(1) to the determination of the amount of gross investment income under sections 4940 and 4948(a), any distribution made to a private foundation in redemption of stock held by such private foundation in a business enterprise shall be treated as not essentially equivalent to a dividend, if such redemption is described in paragraph (2)(B) of this subsection.”
[Section 314(b)(2) of Pub. L. 98-369 provided that: “The amendment made by paragraph (1) [amending section 101(4)(A)(iii) of Pub. L. 91-172, set out above] shall apply as if included in section 101(l)(4) of the Tax Reform Act of 1969 [Pub. L. 91-172]."]
[Section 1301(b) of Pub. L. 94-455 provided that: “The amendments made by subsection (a) [enacting subpar. (F) of section 101(2) of Pub. L. 91-172, set out above] shall apply to dispositions after the date of the enactment of this Act [Oct. 4, 1976] in taxable years ending after such date."]
[Section 1309(b) of Pub. L. 94-455 provided that: “The amendment made by this section [amending section 101(2)(B) of Pub. L. 91-172, set out above] shall apply to dispositions made after the date of enactment of this Act [Oct. 4, 1976]."]
[Section 4(b) of Pub. L. 93-490 provided that: “The amendment made by this section [enacting subpar. (F) of section 101(3) of Pub. L. 91-172, set out above] shall apply to taxable years beginning after December 31, 1971."]
Pub. L. 100-647, title VI, 6204, Nov. 10, 1988, 102 Stat. 3730, provided that: “For purposes of section 302(c)(3) of the Deficit Reduction Act of 1984 [Pub. L. 98-369, set out below], a private foundation which constituted an operating foundation (as defined in section 4942(j)(3) of the Internal Revenue Code of 1986) for its last taxable year ending before January 1, 1983, shall be treated as constituting an operating foundation as of January 1, 1983.”
Section 302(c)(3) of Pub. L. 98-369 provided that: “A foundation which was an operating foundation (as defined in section 4942(j)(3) of the Internal Revenue Code of 1954) as of January 1, 1983, shall be treated as meeting the requirements of section 4940(d)(2)(B) of such Code (as added by subsection (a)).”