A related organization's assets and net investment income are generally taken into account, for purposes of calculation of the excise tax, in determining whether an institution is an applicable educational institution and in computing the net investment income of an educational institution. If an organization is a related organization with respect to an institution under more than one of these definitions, the rule that attributes the largest amount of assets and net investment income to the institution must be applied.108.24
There are three exceptions to this attribution rule, one being the above‐referenced rule that assets that are used directly in carrying out the institution's exempt purpose are not part of the excise tax base. In determining the attributions, assets and net investment income of a related organization are not taken into account with respect to more than one educational institution; there is to be an allocation between or among the institutions.108.25 Unless a related organization is controlled by the educational institution or is a supporting organization with respect to the institution, assets and net investment income of a related organization that are not intended or available for the use or benefit of the institution are not taken into account by the institution.108.26
Notes
1 96.1 National Philanthropic Trust, 13th Annual Report on Donor‐Advised Funds (Nov. 12, 2019).
2 96.2 In general, Hopkins, Donor‐Advised Funds: Law and Policy (Pittsburgh, PA: Dorrance Pub. Co., 2020).
3 105.1 IRC § 4968(b)(2).
4 108.1 T.D. 9917 (Sep. 18, 2020).
5 108.2 Reg. § 53.4968‐1(b)(2).
6 108.3 Id.
7 108.4 Reg. § 53.4968‐1(b)(3).
8 108.5 Reg. § 53.4968‐1(b)(4).
9 108.6 Reg. § 53.4968‐1(b)(5).
10 108.7 Reg. § 53.4968‐1(b)(5)(iv).
11 108.8 Reg. § 53.4968‐2(a). See supra note 104.
12 108.9 Reg. § 53.4968‐2(b)(1).
13 108.10 Reg. § 53.4968‐2(b)(2).
14 108.11 Reg. § 53.4968‐2(d).
15 108.12 IRC § 4968(d)(2); Reg. § 53.4968‐3(a)(1).
16 108.13 Reg. § 53.4968‐3(a)(2).
17 108.14 Id.
18 108.15 Id.
19 108.16 See §§ 29.7, 30.6.
20 108.17 Reg. § 53.4968‐3(b)(1)‐(3).
21 108.18 Reg. § 53.4968‐3(b)(1).
22 108.19 Reg. § 53.4968‐3(b)(2)(i).
23 108.20 Reg. § 53.4968‐3(b)(3).
24 108.21 Reg. § 53.4968‐3(b)(2)(ii)(A).
25 108.22 Reg. § 53.4968‐3(b)(2)(iii).
26 108.23 Reg. § 53.4968‐3(a)(3).
27 108.24 Reg. § 53.4968‐3(d)(1).
28 108.25 IRC § 4968(d)(1)(A); Reg. § 53.4968‐3(d)(2)(i).
29 108.26 IRC § 4968(d)(1)(B); Reg. § 4968‐3(d)(2)(ii).
CHAPTER TWELVE Public Charities and Private Foundations
§ 12.1 Federal Tax Law Definition of Private Foundation (a) Private Foundation Defined
§ 12.3 Categories of Public Charities (b) Publicly Supported Charities (c) Supporting Organizations
§ 12.4 Private Foundation Rules (f) Other Provisions
§ 12.1 FEDERAL TAX LAW DEFINITION OF PRIVATE FOUNDATION
(a) Private Foundation Defined
p. 286, note 7. Insert before last period:
; Rev. Proc. 2020‐5, 2020‐1 I.R.B. 241, § 7.03.
§ 12.3 CATEGORIES OF PUBLIC CHARITIES
(b) Publicly Supported Charities
p. 300. Insert as second complete paragraph:
A tax‐exempt charitable organization with more than one unrelated business may aggregate its net income and net losses from all unrelated business activities for purposes of determining whether the organization is publicly supported under these rules.155.1 That is, the bucketing rule