TaxNewsFlash-Exempt Organizations

March 6, 2008
No. 2008-20

Proposed Regulations Address the Tax Effect of UBTI on Charitable Remainder Trusts

The Treasury Department and IRS today released for publication in the Federal Register proposed regulations (REG-127391-07) that address the changes to section 664(c) by the Tax Relief and Health Care Act of 2006, that provide that charitable remainder trusts with unrelated business taxable income (UBTI) in tax years beginning after December 31, 2006, are exempt from federal income tax but are subject to a 100% excise tax on the UBTI. The proposed regulations provide reporting and payment rules with respect to the excise tax.

For a computer-scanned version of today’s proposed regulations: REG-127391-07

Comments concerning the proposed regulations must be received by May 6, 2008. A public hearing has been scheduled for April 11, 2008, and outlines of topics to be discussed at the hearing must be received by March 28, 2008.

REG-127391-07 will appear in the Federal Register on Friday, March 7, 2008.

For more information, contact Rick Speizman, National Partner-In-Charge, KPMG’s Exempt Organizations Tax Practice (ExoTax), at (202) 533-3084 or rspeizma@kpmg.com

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