Joint Ventures Involving Tax-Exempt Organizations, 2023 Supplement

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 Foundations’ Activities That Limit Excess Business Holdings 4 § 1.24 Other Developments 4 Chapter 2: Taxation of Charitable Organizations 9 § 2.1 Introduction 9 § 2.2 Categories of Exempt Organizations 15 § 2.3 § 501(c)(3) Organizations: Statutory Requirements (Revised) 19 § 2.4 Charitable Organizations: General Requirements 25 § 2.5 Categories of Charitable Organizations (Revised) 26 § 2.6 Application for Exemption 30 § 2.7 Governance 40 § 2.8 Form 990: Reporting and Disclosure Requirements 41 § 2.9 Redesigned Form 990 44 § 2.10 The IRS Audit 44 § 2.11 Charitable Contributions 49 Chapter 3: Taxation of Partnerships and Joint Ventures 61 § 3.1 Scope of Chapter 61 § 3.3 Classification as a Partnership (Revised) 64 § 3.4 Alternatives to Partnerships 77 § 3.7 Formation of Partnership 77 § 3.8 Tax Basis in Partnership Interest 78 § 3.9 Partnership Operations 79 § 3.10 Partnership Distributions to Partners 79 § 3.11 Sale or Other Disposition of Assets or Interests 80 § 3.12 Other Tax Issues 80 Chapter 4: Overview: Joint Ventures Involving Exempt Organizations 85 § 4.1 Introduction 85 § 4.2 Exempt Organization as General Partner: A Historical Perspective 86 § 4.6 Revenue Ruling 2004-51 and Ancillary Joint Ventures 88 § 4.9 Conversions from Exempt to For-Profit and from For-Profit to Exempt Entities 88 § 4.10 Analysis of a Virtual Joint Venture 89 Chapter 5: Private Benefit, Private Inurement, and Excess Benefit Transactions 91 § 5.1 What Are Private Inurement and Private Benefit? 91 § 5.2 Transactions in Which Private Benefit or Inurement May Occur 93 § 5.3 Profit-Making Activities as Indicia of Nonexempt Purpose 94 § 5.4 Intermediate Sanctions 95 § 5.7 State Activity with Respect to Insider Transactions 105 Chapter 6: Engaging in a Joint Venture: The Choices 107 § 6.1 Introduction 107 § 6.2 LLCs 108 § 6.3 Use of a For-Profit Subsidiary as Participant in a Joint Venture (Revised) 109 § 6.5 Private Foundations and Program-Related Investments (Revised) 121 § 6.6 Nonprofits and Bonds 125 § 6.7 Exploring Alternative Structures (Revised) 127 § 6.8 Other Approaches (Revised) 131 Chapter 7: Exempt Organizations as Accommodating Parties in Tax Shelter Transactions 145 § 7.2 Prevention of Abusive Tax Shelters (Revised) 145 § 7.3 Excise Taxes and Penalties 146 Chapter 8: The Unrelated Business Income Tax 147 § 8.1 Introduction 147 § 8.3 General Rule 148 § 8.4 Statutory Exceptions to UBIT 149 § 8.5 Modifications to UBIT 150 § 8.7 Calculation of UBIT 150 Chapter 9: Debt-Financed Income 167 § 9.1 Introduction 167 § 9.2 Debt-Financed Property 167 § 9.3 The §514(c)(9) Exception (Revised) 168 § 9.6 The Final Regulations 169 Chapter 10: Limitation on Excess Business Holdings 171 § 10.1 Introduction (Revised) 171 § 10.2 Excess Business Holdings: General Rules (Revised) 171 § 10.3 Tax Imposed 175 § 10.4 Exclusions 176 Chapter 11: Impact on Taxable Joint Ventures: Tax-Exempt Entity Leasing Rules (Revised) 181 § 11.3 Internal Revenue Code § 168(h) 181 § 11.5 Restrictions on Tax-Exempt Use Property (New) 181 Chapter 12: Health Care Entities in Joint Ventures 187 § 12.1 Overview 187 § 12.2 Classifications of Joint Ventures 188 § 12.3 Tax Analysis 189 § 12.4 Other Health Care Industry Issues 191 § 12.5 Preserving the 50/50 Joint Venture 192 § 12.9 Government Scrutiny 192 § 12.11 The Patient Protection and Affordable Care Act of 2010: § 501(r) and Other Statutory Changes Impacting Nonprofit Hospitals 193 § 12.12 The Patient Protection and Affordable Care Act of 2010: ACOs and Co-Ops: New Joint Venture Health Care Entities 196 Chapter 13: Low-Income Housing, New Markets, Rehabilitation, and Other Tax Credit Programs 197 § 13.2 Nonprofit-Sponsored LIHTC Project 197 § 13.3 Low-Income Housing Tax Credit 198 § 13.4 Historic Investment Tax Credit 202 § 13.6 New Markets Tax Credits (Revised) 212 § 13.10 The Energy Tax Credits 227 § 13.11 The Opportunity Zone Funds: New Section 1400Z-1 and Section 1400Z-2 (Revised) 229 §13.12 The Inflation Reduction Act (New) 295 Appendix 13B 303 Chapter 14: Joint Ventures with Universities 319 § 14.1 Introduction 319 § 14.3 Colleges and Universities IRS Compliance Initiative 325 § 14.5 Faculty Participation in Research Joint Ventures 326 § 14.6 Nonresearch Joint Venture Arrangements 328 § 14.7 Modes of Participation by Universities in Joint Ventures (Revised) 329 Chapter 15: Business Leagues Engaged in Joint Ventures 343 § 15.1 Overview 343 § 15.2 The Five-Prong Test 344 § 15.3 Unrelated Business Income Tax 345 Chapter 16: Conservation Organizations in Joint Ventures 347 § 16.1 Overview 347 § 16.2 Conservation and Environmental Protection as a Charitable or Educational Purpose: Public and Private Benefit 347 § 16.3 Conservation Gifts and § 170(h) Contributions (Revised) 348 § 16.7 Emerging Issues 376 Chapter 17: International Joint Ventures 377 § 17.5 General Grantmaking Rules 377 § 17.11 Application of Foreign Tax Treaties 379 Chapter 19: Debt Restructuring and Asset Protection Issues 381 § 19.1 Introduction 381 § 19.2 Overview of Bankruptcy 381 § 19.3 The Estate and the Automatic Stay 382 § 19.4 Case Administration 383 § 19.5 Chapter Plan 384 § 19.6 Discharge 385 § 19.7 Special Issues: Consequences of Debt Reduction 385 Index 387