[Code of Federal Regulations]
[Title 26, Volume 17]
[Revised as of April 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 26CFR53.4943-9]

[Page 149]
 
                       TITLE 26--INTERNAL REVENUE
 
    CHAPTER I--INTERNAL REVENUE SERVICE, DEPARTMENT OF THE TREASURY 
                               (CONTINUED)
 
PART 53_FOUNDATION AND SIMILAR EXCISE TAXES--Table of Contents
 
               Subpart D_Taxes on Excess Business Holdings
 
Sec. 53.4943-9  Business holdings; certain periods.

    (a) Taxable period--(1) In general. For purposes of section 4943, 
the term ``taxable period'' means, with respect to any excess business 
holdings of a private foundation in a business enterprise, the period 
beginning with the first day on which there are such excess business 
holdings and ending on the earliest of:
    (i) The date of mailing of a notice of deficiency under section 6212 
with respect to the tax imposed on the holdings by the section 4943(a);
    (ii) The date on which the excess is eliminated; or
    (iii) The date on which the tax imposed by section 4943(a) is 
assessed.

For example, M, a private foundation, first has excess business holdings 
in X, a corporation, on February 5, 1972. A notice of deficiency is 
mailed under section 6212 to M on June 1, 1974. With respect to M 's 
excess business holdings in X, the taxable period begins on February 5, 
1972, and ends on June 1, 1974.
    (2) Special rule. Where a notice of deficiency referred to in 
subparagraph (1)(i) of this paragraph is not mailed because there is a 
waiver of the restrictions on assessment and collection of a deficiency, 
or because the deficiency is paid, the date of filing of the waiver or 
the date of such payment, respectively, shall be treated as the end of 
the taxable period.
    (3) Suspension of taxable period for 90 days. In any case in which a 
private foundation has excess business holdings solely because of the 
acquisition of an interest in a business enterprise to which paragraph 
(a)(1) (ii) or (iii) of Sec. 53.4943-2 applies, the taxable period 
described in paragraph (a) of this section shall be suspended for the 
90-day period (as extended) starting with the date on which the 
foundation knows or has reason to know of the acquisition, provided that 
at the end of such period the foundation has disposed of such excess 
holdings.
    (b) Cross reference. For rules relating to taxable events that are 
corrected within the correction period, defined in section 4863(e), see 
section 4861(a) and the regulations thereunder.
    (c) Correction. For purposes of section 4943, correction shall be 
considered as made when no interest in the enterprise held by the 
foundation is classified as an excess business holdings under section 
4943(c)(1). In any case where the private foundation has excess business 
holdings which are constructively held for it under section 4943(c)(1), 
correction shall be considered made when either a corporation, 
partnership, estate, or trust in which holdings in such enterprise are 
constructively held for the foundation or a disqualified person; the 
foundation itself; or a disqualified person disposes of a sufficient 
interest in the enterprise so that no interest in the enterprise held by 
the foundation is classified as excess business holdings under section 
4943(c)(1).

[T.D. 7496, 42 FR 46285, Sept. 15, 1977, as amended by T.D. 8084, 51 FR 
16302, May 2, 1986]