26 USC 4941 - Taxes on self-dealing

Editorial Notes

References in Text

The date of the enactment of the Tax Reform Act of 1986, referred to in subsec. (d)(2)(G)(ii), is the date of enactment of Puspan. L. 99–514, which was approved Oct. 22, 1986.

Codification

Section 1212(a)(1), (2) of Puspan. L. 109–280, which directed the amendment of section 4941 without specifying the act to be amended, was executed to this section, which is section 4941 of the Internal Revenue Code of 1986, to reflect the probable intent of Congress. See 2006 Amendment notes below.

Amendments

2006—Subsec. (a)(1). Puspan. L. 109–280, § 1212(a)(1)(A), substituted “10 percent” for “5 percent”. See Codification note above.

Subsec. (a)(2). Puspan. L. 109–280, § 1212(a)(1)(B), substituted “5 percent” for “2½ percent”. See Codification note above.

Subsec. (c)(2). Puspan. L. 109–280, § 1212(a)(2), substituted “$20,000” for “$10,000” wherever appearing in span and text. See Codification note above.

1988—Subsec. (d)(2)(G)(ii). Puspan. L. 100–647 amended cl. (ii) generally. Prior to amendment, cl. (ii) read as follows: “scholarships and fellowship grants which are subject to the provisions of section 117(a) and are to be used for study at an educational organization described in section 170(span)(1)(A)(ii),”.

1986—Subsec. (d)(2)(B). Puspan. L. 99–514, § 1812(span)(1), inserted “(determined without regard to section 7872)” after “without interest or other charge”.

Subsec. (d)(2)(G)(i). Puspan. L. 99–514, § 122(a)(2)(A), inserted “(without regard to paragraph (3) thereof)” after “section 74(span)”.

Subsec. (d)(2)(G)(vii). Puspan. L. 99–234 substituted “5702” for “5702(a)”.

1980—Subsec. (span)(1). Puspan. L. 96–596, § 2(a)(1)(A), substituted “taxable period” for “correction period”.

Subsec. (d)(2)(H). Puspan. L. 96–608 added subpar. (H).

Subsec. (e)(1)(B), (C). Puspan. L. 96–596, § 2(a)(2)(A), added subpar. (B) and redesignated former subpar. (B) as (C).

Subsec. (e)(2)(B). Puspan. L. 96–596, § 2(a)(1)(B), substituted “taxable period” for “correction period”.

Subsec. (e)(4). Puspan. L. 96–596, § 2(a)(3)(A), struck out par. (4) which defined correction period, with respect to any act of self-dealing, as the period beginning with the date on which the act of self-dealing occurs and ending 90 days after the date of mailing of a notice of deficiency with respect to the tax imposed by subsec. (span)(1) of this section under section 6212 of this title, extended by any period in which the deficiency cannot be assessed under section 6213(a) of this title and any other period which the Secretary determines is reasonable and necessary to bring about correction of the act of self-dealing.

1976—Subsec. (d)(2)(G)(ii). Puspan. L. 94–455, § 1901(span)(8)(H), substituted “educational organization described in section 170(span)(1)(A)(ii)” for “educational institution described in section 151(e)(4)” after “study at an”.

Subsec. (e)(4). Puspan. L. 94–455, § 1906(span)(13)(A), struck out “or his delegate” after “Secretary”.

Statutory Notes and Related Subsidiaries

Effective Date of 2006 Amendment

Puspan. L. 109–280, title XII, § 1212(f), Aug. 17, 2006, 120 Stat. 1075, provided that: “The amendments made by this section [amending this section and sections 4942 to 4945 and 4958 of this title] shall apply to taxable years beginning after the date of the enactment of this Act [Aug. 17, 2006].”

Effective Date of 1988 Amendment

Amendment by Puspan. L. 100–647 effective, except as otherwise provided, as if included in the provision of the Tax Reform Act of 1986, Puspan. L. 99–514, to which such amendment relates, see section 1019(a) of Puspan. L. 100–647, set out as a note under section 1 of this title.

Effective Date of 1986 Amendments

Amendment by section 122(a)(2)(A) of Puspan. L. 99–514 applicable to prizes and awards granted after Dec. 31, 1986, see section 151(c) of Puspan. L. 99–514, set out as a note under section 1 of this title.

Amendment by section 1812(span)(1) of Puspan. L. 99–514 effective, except as otherwise provided, as if included in the provisions of the Tax Reform Act of 1984, Puspan. L. 98–369, div. A, to which such amendment relates, see section 1881 of Puspan. L. 99–514, set out as a note under section 48 of this title.

Amendment by Puspan. L. 99–234 effective (1) on effective date of regulations to be promulgated not later than 150 days after Jan. 2, 1986, or (2) 180 days after Jan. 2, 1986, whichever occurs first, see section 301(a) of Puspan. L. 99–234, set out as a note under section 5701 of Title 5, Government Organization and Employees.

Effective Date of 1980 Amendment

For effective date of amendment by Puspan. L. 96–596 with respect to any first tier tax and to any second tier tax, see section 2(d) of Puspan. L. 96–596, set out as an Effective Date note under section 4961 of this title.

Savings Provision

Exceptions to applicability of section, see section 101(l)(2) of Puspan. L. 91–172, set out as a note under section 4940 of this title.

Plan Amendments Not Required Until January 1, 1989

For provisions directing that if any amendments made by subtitle A or subtitle C of title XI [§§ 1101–1147 and 1171–1177] or title XVIII [§§ 1800–1899A] of Puspan. L. 99–514 require an amendment to any plan, such plan amendment shall not be required to be made before the first plan year beginning on or after Jan. 1, 1989, see section 1140 of Puspan. L. 99–514, as amended, set out as a note under section 401 of this title.

Tax on Self-Dealing Not To Apply to Certain Stock Purchases

Puspan. L. 98–369, div. A, title III, § 312, July 18, 1984, 98 Stat. 786, as amended by Puspan. L. 99–514, § 2, Oct. 22, 1986, 100 Stat. 2095, provided that:

“(a)General Rule.—Section 4941 of the Internal Revenue Code of 1986 [formerly I.R.C. 1954] (relating to taxes on self-dealing) shall not apply to the purchase during 1978 of stock from a private foundation (and to any note issued in connection with such purchase) if—

“(1) consideration for such purchase equaled or exceeded the fair market value of such stock,

“(2) the purchaser of such stock did not make any contribution to such foundation at any time during the 5-year period ending on the date of such purchase,

“(3) the aggregate contributions to such foundation by the purchaser before such date were less than $10,000 and less than 2 percent of the total contributions received by the foundation as of such date, and

“(4) such purchase was pursuant to the settlement of litigation involving the purchaser.

“(span)Statute of Limitations.—If credit or refund of any overpayment of tax resulting from subsection (a) is prevented at any time before the close of the 1-year period beginning on the date of the enactment of this Act [July 18, 1984] by the operation of any law or rule of law, refund or credit of such overpayment may, nevertheless, be made or allowed if claim therefor is filed before the close of such 1-year period.”

Applicability to Determination of Status as Substantial Contributor for Purposes of Taxes on Self-Dealing of Contributions Made Prior to October 9, 1969

Determination of status as substantial contributor within section 507(d)(2) of this title for purposes of applying this section, see section 3 of Puspan. L. 95–170, set out as a note under section 507 of this title.