Tax Exempt Organizations Brochure


Tax Exempt Organizations

Bracewell’s tax-exempt organizations team regularly advises a wide range of nonprofit corporations and charitable trusts about the applicable complex rules and regulations. We routinely advise clients about various federal tax issues, such as compliance with the private inurement proscription, the private benefit limitation, excise taxes applicable to private foundations and related persons, the lobbying and electioneering rules, structuring investments to avoid unrelated business income tax, IRS examinations and rulings, and tax-exempt finance. In addition, we provide legal guidance to nonprofit corporations in connection with a variety of business transactions, such as mergers and acquisitions, sales and purchases of physician practices, and debt offerings. Finally, we help clients comply with board governance issues, such as drafting and interpreting governance documents and policies, and negotiating gift and naming rights agreements with donors. Our nonprofit clients include hospitals and healthcare organizations, colleges and universities, independent and parochial schools, museums and arts organizations, conservation organizations, advocacy groups, student loan organizations, and grant-making foundations and charitable trusts.

Our recent notable matters include advising on the following:

Public charities and private foundations

Student loan organization represented a public charity in connection with its purchase of a portfolio of below interest student loans Senior living facility obtained group exemption ruling for subordinate affiliates of a senior living facility

Public charity provided guidance about continued qualification as an “educational organization” Hospital provided guidance with respect to the status of services providers as employees versus independent contractors Multi-hospital health care system advocating for client in Internal Revenue Service examination of client’s partnerships with proprietary health care providers Health care organization provided guidance relating to the rules and regulations enacted as part of the Affordable Care Act, including Internal Revenue Code Section 501(r) University structured the transfer of intellectual property to a for-profit company in exchange for royalty payments

provided guidance with respect to the creation, funding and maintenance of private foundations, public charities and endowment funds, including providing tax advice with respect to relevant excise taxes and unrelated business taxable income issues

Healthcare organization structured joint ventures and

Private foundation provided advice relating to the

partnerships with for profit entities to protect continued tax-exempt status of exempt participants

exclusion of a large tract of real estate from its minimum investment return calculation

University addressed issues related to “debt- financed property” arising from electric generation facilities located on campus University structured an agreement whereby commercial sponsors fund research to be performed by the University Independent school addressed governance and compliance issues, including providing board training, a review of organizational documents, and the drafting of policies related to the operation of the school and its fundraising activities

Tax-exempt organization represented client in connection with an IRS audit relating to alleged political activities Pediatric Hospital provided advice about the reporting requirements related to “quid pro quo contributions” in fundraising activities Tax-Exempt Organization provided advice regarding the “program-related investment” exception to jeopardizing investment rules


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