A List of Projects from the IRS’s 2016–2017 Priority Guidance Plan Affecting Exempt Organizations

On August 15, 2016, the IRS and the Department of the Treasury issued the 2016–2017 Priority Guidance Plan. The plan includes 281 projects that the IRS and the Treasury intend to actively work on during the 12-month period from July 2016 through June 2017. It includes some projects that carried over from the 2015–2016 plan as well as a number of new items. Updates will be provided during the plan year to reflect additional items that become priorities and any published guidance. Projects that may be of interest to exempt organizations are listed below.

Projects for Exempt Organizations

Here are items projects that will be updated:

  • Revenue procedures for grantor and contributor reliance criteria under Sections 170 and 509
  • Revenue Procedure 2011-33 for “EO Select Check”
  • Revenue Ruling 67-390, which discusses changes to an exempt organization’s structure that would result in filing Form 1023
  • Revenue Procedure 92-94, which discusses the equivalency determination process for purposes of Sections 4942 and 4945

Projects being finalized include regulations and guidance related to:

  • Sections 501(a), 501(c)(3), and 508 to streamline the application process for eligible organizations applying for recognition of tax-exempt status under Section 501(c)(3)—final and temporary regulations were published on July 2, 2014
  • Section 506 as added by the Protecting Americans from Tax Hikes Act of 2015—final and temporary regulations were published on July 12, 2016, and Revenue Procedure 2016-41 was published July 25, 2016
  • Section 509(a)(3) supporting organizations—proposed regulations were published February 19, 2016
  • Section 512 regarding methods of allocating expenses relating to dual-use facilities
  • Section 529A on Qualified ABLE Programs as added by Section 102 of the ABLE Act of 2014—proposed regulations were published June 22, 2015
  • Section 4941 regarding a private foundation’s investment in a partnership in which disqualified persons are also partners
  • Excise taxes on donor-advised funds and fund management
  • Section 6033 for the reporting of contributions
  • Section 6104(c)—proposed regulations were published March 15, 2011
  • Section 7611 for church tax inquiries and examinations—proposed regulations were published August 5, 2009

Projects for Charitable Contributions

Following are guidance and regulations that will be finalized:

  • Section 170 for charitable contributions of appropriative water rights
  • Section 170 for charitable contributions of conservation easements
  • Section 170 for charitable contributions—proposed regulations were published August 7, 2008
  • Section 170(e)(3) for charitable contributions of inventory

Projects for Tax-Exempt Bonds

There’s one set of regulations that will be clarified that refers to the definition of political subdivision under Section 103 for purposes of the tax-exempt, tax credit, and direct-pay bond provisions. Proposed regulations were published February 23, 2016.

On the list to be updated is Revenue Procedure 97-13 relating to the conditions under which a management contract doesn’t result in private business use under Section 141. 

Expected to be finalized are guidance and regulations on these topics:

  • Remedial actions for tax-advantaged bonds under Sections 54A, 54AA, and 141
  • Public approval requirements for private activity bonds under Section 147(f)—proposed regulations were published September 9, 2008
  • Arbitrage investment restrictions under Section 148—final regulations were published as TD 9777 on July 17, 2016.
  • The definition of issue price for tax-exempt bonds under Section 148—proposed regulations were published June 24, 2015
  • Bond reissuance under Section 150

The 2016–2017 Priority Guidance Plan also includes projects related to employee benefits—retirement benefits, executive compensation, health care, and employment taxes. To understand how these projects might affect your business, contact your Moss Adams professional.