ACC Docket | Jan./Feb. 2020 | Vol. 38 No. 1 | Pages: 60-63
Many corporations have focused charitable activities within a corporate foundation to better manage their charitable giving. With such a close connection between a corporate foundation and its related corporation’s business, there is potential for inadvertent self-dealing, whether it’s distributing foundation-sponsored tickets to members of the corporation or charging the foundation for its share of office space. Generally, acts of self-dealing between a private foundation and its substantial contributors (such as the related corporation) are subject to severe excise taxes, with few exceptions. As a result, careful planning must be undertaken regarding any proposed transaction between the related business and the foundation.