[Code of Federal Regulations]
[Title 26, Volume 7]
[Revised as of April 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 26CFR1.507-4]

[Page 89]
 
                       TITLE 26--INTERNAL REVENUE
 
    CHAPTER I--INTERNAL REVENUE SERVICE, DEPARTMENT OF THE TREASURY 
                               (CONTINUED)
 
PART 1_INCOME TAXES--Table of Contents
 
Sec. 1.507-4  Imposition of tax.

    (a) General rule. Section 507(c) imposes on each organization the 
private foundation status of which is terminated under section 507(a) a 
tax equal to the lower of:
    (1) The amount which such organization substantiates by adequate 
records (or other corroborating evidence which may be required by the 
Commissioner) as the aggregate tax benefit (as defined in section 
507(d)) resulting from the section 501(c)(3) status of such 
organization, or
    (2) The value of the net assets of such organization.
    (b) Transfers not subject to section 507(c). Private foundations 
which make transfers described in section 507(b)(1)(A) or (2) are not 
subject to the tax imposed under section 507(c) with respect to such 
transfers unless the provisions of section 507(a) become applicable. See 
Sec. Sec. 1.507-1(b), 1.507-2(a)(6) and 1.507-3(d).

[T.D. 7233, 37 FR 28161, Dec. 21, 1972]