Avoiding Form 990-PF Errors: Identifying Self-Dealing, Monitoring Minimum Distribution Requirements, Excise Taxes

Private foundations are organized for charitable purposes and required to make their annual 990-PF available for public inspection. These entities are vulnerable to at least five different excise taxes ranging from one percent to 200 percent. Private foundations may compensate disqualified persons as long as the compensation is reasonable and necessary.

Private foundations are charged with doing good and must meet specific minimum distribution requirements. Often, more or less than the calculated minimum distribution is paid out--both carry reporting conundrums. If the foundation is not generous enough in a given year, it is subject to an excise tax; if it is overly generous, it has an excess grant carryover to distribute in the future. Neglecting to include relative expenses as qualifying distributions is cited as a typical preparation error by foundation experts.

Along with concerns about what the foundation should report, advisers must determine what not to report. The IRS List, Common Errors Made by Exempt Organizations, advises "Do not include unnecessary personal identifying information."

Listen as our panel provides line-by-line advice on reporting complicated private foundation transactions, points out how and when to avoid excise taxes, and explains steps that will facilitate the preparation of a foundation's Form 990-PF.

1. Common private foundation reporting errors
2. Avoiding and minimizing excise taxes
3. Disclosing reportable transactions
4. Avoiding over disclosure
5. Recommendations to improve the preparation and presentation of a 990-PF

The panel will review these and other important issues:

• Reporting, minimizing, and avoiding private foundation excise taxes
• Properly making required disclosures
• Avoiding common reporting errors
• Identifying disclosures that are not required

Learning Objectives

After completing this course, you will be able to:

• Recognize prohibited transactions
• Ascertain when taking steps to ensure the one percent net investment tax is warranted
• Determine what a private foundation does and does not have to disclose
• Identify common 990-PF reporting errors

• Field of Study: Taxes
• Level of Knowledge: Intermediate
• Advance Preparation: None
• Teaching Method: Seminar/Lecture
• Delivery Method: Group-Internet (via computer)
• Attendance Monitoring Method: Attendance is monitored electronically via a participant's PIN and through a series of attendance verification prompts displayed throughout the program
• Prerequisite: Three years+ business or public firm experience preparing complex tax forms and schedules, supervising other preparers or accountants. Specific knowledge and understanding of pass-through taxation, including taxation of partnerships, S corporations and sole proprietorships, qualified business income, net operating losses and loss limitations; familiarity with net operating loss carry-backs, carry-forwards and carried interests.

Strafford Publications, Inc. is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of Accountancy have final authority on the acceptance of individual courses for CPE Credits. Complaints regarding registered sponsons may be submitted to NASBA through its website: www.nasbaregistry.org.

IRS Approved Provider

Strafford is an IRS-approved continuing education provider offering certified courses for Enrolled Agents (EA) and Tax Return Preparers (RTRP).