EO Tax Journal

1 – Old Business

2 – More on the AARP Hearing Continue…

Seems like it has been a long week, so let’s just ease into the weekend. Even tax lawyers are expected to know constitutional law — after all, we did go to law school, didn’t we? — even if some of us were sitting in the back row napping — so I’m sending along today a CRS report that discusses the current ground rules for aid to private schools that I think would be at least embarrassing for an EO lawyer not to know.

Since we’re talking schools, what would a Friday be without a quiz. News sources are reporting that Bristol Palin was paid a total of $332,500 to urge teenagers to abstain from sex ($262,500 in 2009 for 15 to 20 days of work and $70,000 in 2010) by The Candies Foundation, a New York-based foundation, which, according to the Associated Press, is “a division of the apparel brand Candie’s.” According to Reuters,the foundation is “an offshoot of the fashion brand Candie’s, which is part of Iconix Brand Group Inc.,” of which the foundation founder, Neil Cole, is CEO and president. Cole has shrugged off criticism that the foundation, while paying Bristol $262,500 in 2009, made only two grants for $35,000 in 2009.

Query: I’m sure Bristol is worth every cent of what she was paid by the foundation, but let’s suppose she was overpaid. What are the possible tax consequences? Section 4958 would not seem to be an issue, since it does not apply to private foundations and Bristol would not seem to be a disqualified person. That leaves Chapter 42. Section 4941 would not seem to apply since Bristol, again, would not seem to be a disqualified person. But how about section 4945? If a foundation were to pay too much to an individual who is not a disqualified person, would we have a possible taxable expenditure under section 4945(d)? Continue…

1 – Inauguration Activities Clarification

2 – New Hospital Requirements Discussed

6 – Post-Issuance Bond Compliance Continue…

1 – Latest IRS EO Update

2 – Alaska’s Sandy Deja’s EOMF Update

3 – Chuck v. Rahm

4 – More on AARP Hearing

5 – New York Times’ Articles

6 – Interesting PLRs Released Last Week Continue…

Friday’s House Ways and Means Committee hearing on AARP is probably not worth discussing — except for what it may portend. The what, when, where, and why I covered last week in Email Update 2011-56, for those just tuning in.

After opening statements by Representatives Wally Herger (R-CA), Charles Boustany (R-LA), Dave Reichert (R-WA), and Barry Rand, CEO, AARP (all available on the House Ways and Means Committee website), the first panel of the hearing consisted of Republican committee members beating up on Rand (whose evasiveness would have made the late Everett Dirksen proud) and Lee Hammond, President, AARP Board of Directors. In-between Republican attacks, Democratic committee members defended AARP or attacked the Republicans for a political witch-hunt. For anyone who wants to watch the actual blood-letting, the hearing is available on C-SPAN. Continue…