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26 U.S.C. § 681 — Limitation on charitable deduction
Federal law — U.S. Code and appendices · legal_authorities
**(a) Trade or business income** In computing the deduction allowable under section 642(c) to a trust, no amount otherwise allowable under section 642(c) as a deduction shall be allowed as a deduction with respect to income of the taxable year which is allocable to its unrelated business income for such year. For purposes of the preceding sentence, the term “unrelated business income” means an amount equal to the amount which, if such trust were exempt from tax under section 501(a) by reason of section 501(c)(3), would be computed as its unrelated business taxable income under section 512 (relating to income derived from certain business activities and from certain property acquired with borrowed funds).
**(b) Cross reference** For disallowance of certain charitable, etc., deductions otherwise allowable under section 642(c), see sections 508(d) and 4948(c)(4).
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Source file: Laws/federal/codes/united-states-code/title-26/section-681-limitation-on-charitable-deduction--4ea4b4df87.md
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Source location: Title 26, Chapter 1, § 681; chapter-001-normal-taxes-and-surtaxes.md
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**(a) Trade or business income** In computing the deduction allowable under section 642(c) to a trust, no amount otherwise allowable under section 642(c) as a deduction shall be allowed as a deduction with respect to income of the taxable year which is allocable to its unrelated business income for such year. For purposes of the preceding sentence, the term “unrelated business income” means an amount equal to the amount which, if such trust were exempt from tax under section 501(a) by reason of section 501(c)(3), would be computed as its unrelated business taxable income under section 512 (relating to income derived from certain business activities and from certain property acquired with borrowed funds).
**(b) Cross reference** For disallowance of certain charitable, etc., deductions otherwise allowable under section 642(c), see sections 508(d) and 4948(c)(4).
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Federal law — U.S. Code and appendices · legal_authorities
**(a) General rule** An organization which—
(1) was exempt (or was determined by the Secretary to be exempt) from taxation under section 501(a) by reason of being an organization described in section 501(c)(3), and
(2) is not an organization described in section 501(c)(3)—
(A) by reason of carrying on propaganda, or otherwise attempting, to influence legislation, or
(B) by reason of participating in, or intervening in, any political campaign on behalf of (or in opposition to) any candidate for public office,
shall not at any time thereafter be treated as an organization described in section 501(c)(4).
**(b) Regulations to prevent avoidance** The Secretary shall prescribe such regulations as may be necessary or appropriate to prevent the avoidance of subsection (a), including regulations relating to a direct or indirect transfer of all or part of the assets of an organization to an organization controlled (directly or indirectly) by the same person or persons who control the transferor organization.
**(c) Churches, etc.** Subsection (a) shall not apply to any organization which is a disqualified organization within the meaning of section 501(h)(5) (relating to churches, etc.) for the taxable year immediately preceding the first taxable year for which such organization is described in paragraph (2) of subsection (a).
Source: Supplied U.S. Code snapshot — release unconfirmed · 26 U.S.C. § 504
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Federal law — U.S. Code and appendices · legal_authorities
**(a) Tax-exempt foundations** There is hereby imposed on each private foundation which is exempt from taxation under section 501(a) for the taxable year, with respect to the carrying on of its activities, a tax equal to 1.39 percent of the net investment income of such foundation for the taxable year.
**(b) Taxable foundations** There is hereby imposed on each private foundation which is not exempt from taxation under section 501(a) for the taxable year, with respect to the carrying on of its activities, a tax equal to—
(1) the amount (if any) by which the sum of (A) the tax imposed under subsection (a) (computed as if such subsection applied to such private foundation for the taxable year), plus (B) the amount of the tax which would have been imposed under section 511 for the taxable year if such private foundation had been exempt from taxation under section 501(a), exceeds
(2) the tax imposed under subtitle A on such private foundation for the taxable year.
**(c) Net investment income defined**
(1) **In general** — For purposes of subsection (a), the net investment income is the amount by which (A) the sum of the gross investment income and the capital gain net income exceeds (B) the deductions allowed by paragraph (3). Except to the extent inconsistent with the provisions of this section, net investment income shall be determined under the principles of subtitle A.
(2) **Gross investment income** — For purposes of paragraph (1), the term “gross investment income” means the gross amount of income from interest, dividends, rents, payments with respect to securities loans (as defined in section 512(a)(5)), and royalties, but not including any such income to the extent included in computing the tax imposed by section 511. Such term shall also include income from s
Source: Supplied U.S. Code snapshot — release unconfirmed · 26 U.S.C. § 4940
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Federal law — U.S. Code and appendices · legal_authorities
**(a) Charitable, etc., organizations taxable at corporation rates**
(1) **Imposition of tax** — There is hereby imposed for each taxable year on the unrelated business taxable income (as defined in section 512) of every organization described in paragraph (2) a tax computed as provided in section 11. In making such computation for purposes of this section, the term “taxable income” as used in section 11 shall be read as “unrelated business taxable income”.
(2) **Organizations subject to tax**
(A) *Organizations described in sections 401(a) and 501(c)* — The tax imposed by paragraph (1) shall apply in the case of any organization (other than a trust described in subsection (b) or an organization described in section 501(c)(1)) which is exempt, except as provided in this part or part II (relating to private foundations), from taxation under this subtitle by reason of section 501(a).
(B) *State colleges and universities* — The tax imposed by paragraph (1) shall apply in the case of any college or university which is an agency or instrumentality of any government or any political subdivision thereof, or which is owned or operated by a government or any political subdivision thereof, or by any agency or instrumentality of one or more governments or political subdivisions. Such tax shall also apply in the case of any corporation wholly owned by one or more such colleges or universities.
**(b) Tax on charitable, etc., trusts**
(1) **Imposition of tax** — There is hereby imposed for each taxable year on the unrelated business taxable income of every trust described in paragraph (2) a tax computed as provided in section 1(e). In making such computation for purposes of this section, the term “taxable income” as used in section 1 shall be read as “unrelated business tax
Source: Supplied U.S. Code snapshot — release unconfirmed · 26 U.S.C. § 511
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Federal law — U.S. Code and appendices · legal_authorities
Page 1854
TITLE 26—INTERNAL REVENUE CODE
§ 681
funded branch plans, and time and manner for making
elections, see section 2(e) of Pub. L. 96–603, set out as
an Effective Date note under section 404A of this title.
EFFECTIVE DATE
Pub. L. 94–455, title X, § 1013(f)(1), Oct. 4, 1976, 90 Stat.
1616, provided that: ‘‘The amendments made by this
section (other than subsection (c)) [enacting this sec-
tion and amending sections 643, 678, 6048, and 6678 of
this title] shall apply to taxable years ending after De-
cember 31, 1975, but only in the case of—
‘‘(A) foreign trusts created after May 21, 1974, and
‘‘(B) transfers of property to foreign trusts after
May 21, 1974.’’
SUBPART F—MISCELLANEOUS
Sec.
681.
Limitation on charitable deduction.
[682.
Repealed.]
683.
Use of trust as an exchange fund.
684.
Recognition of gain on certain transfers to
certain foreign trusts and estates.
685.
Treatment of funeral trusts.
Editorial Notes
AMENDMENTS
2017—Pub. L. 115–97, title I, § 11051(b)(1)(C), Dec. 22,
2017, 131 Stat. 2089, struck out item 682 ‘‘Income of an
estate or trust in case of divorce, etc.’’
2010—Pub. L. 111–312, title III, § 301(a), Dec. 17, 2010,
124 Stat. 3300, amended analysis to read as if amend-
ment by Pub. L. 107–16, § 542(e)(1)(D), had never been en-
acted. See 2001 Amendment note below.
2001—Pub. L. 107–16, title V, § 542(e)(1)(D), June 7, 2001,
115 Stat. 85, inserted ‘‘and nonresident aliens’’ after
‘‘estates’’ in item 684.
1997—Pub. L. 105–34, title XI, § 1131(c)(6), title XIII,
§ 1309(b), Aug. 5, 1997, 111 Stat. 980, 1043, added items 684
and 685.
1976—Pub. L. 94–455, title XXI, § 2131(e)(2), Oct. 4, 1976,
90 Stat. 1924, substituted ‘‘Use of trust as an exchange
fund’’ for ‘‘Applicability of provisions’’ in item 683.
§ 681. Lim
Source: Supplied 2024 U.S. Code historical extraction · 26 U.S.C. § 681
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