Preface xi
Acknowledgments xv
Chapter 1: Introduction: Joint Ventures Involving Exempt Organizations 1
1.4 University Joint Ventures 1
1.5 Low-Income Housing and New Markets Tax Credit Joint Ventures 1
1.6 Conservation Joint Ventures 2
1.8 Rev. Rul. 98-15 and Joint Venture Structure 2
1.10 Ancillary Joint Ventures: Rev. Rul. 2004-51 2
1.14 The Exempt Organization as a Lender or Ground Lessor 2
1.15 Partnership Taxation 3
1.17 Use of a Subsidiary as a Participant in a Joint Venture 3
1.22 Limitation on Private Foundation's Activities That Limit Excess Business Holdings 4
1.24 Other Developments 4
Chapter 2: Taxation of Charitable Organizations 5
2.1 Introduction (Revised) 5
2.2 Categories of Exempt Organizations (Revised) 10
2.3 501(c)(3) Organizations: Statutory Requirements (Revised) 13
2.4 Charitable Organizations: General Requirements 14
2.6 Application for Exemption 15
2.7 Governance 21
2.8 Form 990: Reporting and Disclosure Requirements (Revised) 22
2.10 The IRS Audit 24
2.11 Charitable Contributions (Revised) 27
Chapter 3: Taxation of Partnerships and Joint Ventures 35
3.1 Scope of Chapter 35
3.3 Classification as a Partnership 38
3.4 Alternatives to Partnerships 38
3.7 Formation of Partnership 38
3.8 Tax Basis in Partnership Interest 39
3.9 Partnership Operations 39
3.11 Sale or Other Disposition of Assets or Interests 40
3.12 Other Tax Issues (Revised) 41
Chapter 4: Overview: Joint Ventures Involving Exempt Organizations 47
4.1 Introduction 47
4.2 Exempt Organization as General Partner: A Historical Perspective 48
4.6 Revenue Ruling 2004-51 and Ancillary Joint Ventures 50
4.9 Conversions from Exempt to For-Profit and from For-Profit to Exempt Entities 50
4.10 Analysis of a Virtual Joint Venture 50
Chapter 5: Private Benefit, Private Inurement, and Excess Benefit Transactions 53
5.1 What Are Private Inurement and Private Benefit? (Revised) 53
5.2 Transactions in Which Private Benefit or Inurement May Occur 55
5.3 Profit-Making Activities as Indicia of Nonexempt Purpose 57
5.4 Intermediate Sanctions (Revised) 57
5.7 State Activity with Respect to Insider Transactions 65
Chapter 6: Engaging in a Joint Venture: The Choices 67
6.1 Introduction 67
6.2 LLCs (Revised) 68
6.3 Use of a For-Profit Subsidiary as Participant in a Joint Venture 69
6.5 Private Foundations and Program-Related Investments 73
6.6 Nonprofits and Bonds (Revised) 77
6.7 Exploring Alternative Structures 79
6.8 Other Approaches 80
Chapter 7: Exempt Organizations as Accommodating Parties in Tax Shelter Transactions 83
7.2 Prevention of Abusive Tax Shelters 83
7.3 Excise Taxes and Penalties 84
Chapter 8: The Unrelated Business Income Tax 85
8.1 Introduction 85
8.3 General Rule 86
8.4 Statutory Exceptions to UBIT (Revised) 87
8.5 Modifications to UBIT (Revised) 87
8.7 Calculation of UBIT (Revised) 88
Chapter 9: Debt-Financed Income 99
9.1 Introduction 99
9.2 Debt-Financed Property 99
9.6 The Final Regulations 100
Chapter 10: Limitation on Excess Business Holdings 103
10.1 Introduction 103
10.2 Excess Business Holdings: General Rules (Revised) 103
10.3 Tax Imposed 105
10.4 Exclusions 105
Chapter 12: Healthcare Entities in Joint Ventures 109
12.1 Overview 109
12.2 Classifications of Joint Ventures 110
12.3 Tax Analysis 110
12.4 Other Healthcare Industry Issues 113
12.5 Preserving the 50/50 Joint Venture 113
12.9 Government Scrutiny 114
12.11 The Patient Protection and Affordable Care Act of 2010: 501(r) and Other Statutory Changes Impacting Nonprofit Hospitals 114
12.12 The Patient Protection and Affordable Care Act of 2010: ACOs and Co-Ops: New Joint Venture Healthcare Entities 117
Chapter 13: Low-Income Housing, New Markets, Rehabilitation, and Other Tax Credit Programs 119
13.2 Nonprofit-Sponsored LIHTC Project (New) 119
13.3 Low-Income Housing Tax Credit (Revised) 120
13.4 Historic Investment Tax Credit 122
13.6 New Markets Tax Credits (Revised) 126
13.10 The Energy Tax Credits 141
13.11 The Opportunity Zone Funds: New Section 1400Z-1 and Section 1400Z-2 (Revised) 142
Appendix 13B (New) 165
Chapter 14: Joint Ventures with Universities 183
14.1 Introduction 183
14.3 Colleges and Universities IRS Compliance Initiative (New) 188
14.5 Faculty Participation in Research Joint Ventures 189
14.6 Nonresearch Joint Venture Arrangements 189
14.7 Modes of Participation by Universities in Joint Ventures (Revised) 189
Chapter 15: Business Leagues Engaged in Joint Ventures 193
15.1 Overview 193
15.2 The Five-Prong Test 194
15.3 Unrelated Business Income Tax 194
Chapter 16: Conservation Organizations in Joint Ventures 195
16.1 Overview 195
16.2 Conservation and Environmental Protection as a Charitable or Educational Purpose: Public and Private Benefit 195
16.3 Conservation Gifts and 170(h) Contributions (Revised) 196
16.7 Emerging Issues 210
Chapter 17: International Joint Ventures 211
17.5 General Grantmaking Rules 211
17.11 Application of Foreign Tax Treaties 212
Chapter 19: Debt Restructuring and Asset Protection Issues 215
19.1 Introduction 215
19.2 Overview of Bankruptcy 215
19.3 The Estate and the Automatic Stay 216
19.4 Case Administration 217
19.5 Chapter 11 Plan 217
19.6 Discharge 218
Index 219
