Proposed IRS regulations are issued that are aimed at nonprofits. If finalized, the regs will specify which tax return to use to pay certain excise taxes and when to file returns. They would affect applicable tax-exempt organizations and their related organizations, applicable educational institutions, sponsoring organizations that maintain certain donor-advised funds and their fund managers, and certain donors, donor advisors and others. The regs also would implement the statutory addition of two excise taxes to the first-tier taxes subject to abatement.
An IRS private letter ruling forecasts a good tax outcome for a widow. The taxpayer, as the decedent’s spouse, would be treated as having acquired the IRA in question directly from the decedent, not from the trust that was the IRA’s primary beneficiary, the IRS stated. And she was eligible to roll over the IRA distribution to one or more IRAs established and maintained in her own name. Also, the widow wouldn’t be required to include in income, for the year of distribution, any portion of the IRA proceeds that she timely rolled over to her own IRA.