Easier Rules for Private Foundations on Employee-Owned Stock
New rules make it easier for private foundations to manage their investments in companies with employee stock ownership. Stock bought back from employee retirement plans will not count towards ownership limits, potentially reducing tax burdens for these foundations. Citizens benefiting from such foundations may indirectly see more stable or increased funding for charitable causes.
Key points
Shares bought back by a company from employee stock ownership plans will be treated as still outstanding, helping private foundations avoid excess business holding taxes.
This applies to shares not easily traded on a stock market and purchased on or after January 1, 2020.
The aim is to support the financial stability of private foundations, which often fund important social initiatives.
Status:
Introduced
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