Michael T. Caracci and Cindy W. Caracci, et al. - Page 68




                                       - 68 -                                         
                                      APPENDIX                                        
               SEC.  4958.  TAXES ON EXCESS BENEFIT TRANSACTIONS                      
                    (a)  Initial Taxes.--                                             
                         (1) On the disqualified person.--There                       
                    is hereby imposed on each excess benefit                          
                    transaction a tax equal to 25 percent of the                      
                    excess benefit.  The tax imposed by this                          
                    paragraph shall be paid by any disqualified                       
                    person referred to in subsection (f)(1) with                      
                    respect to such transaction.                                      
                         (2) On the management.--In any case in                       
                    which a tax is imposed by paragraph (1),                          
                    there is hereby imposed on the participation                      
                    of any organization manager in the excess                         
                    benefit transaction, knowing that it is such                      
                    a transaction, a tax equal to 10 percent of                       
                    the excess benefit, unless such participation                     
                    is not willful and is due to reasonable                           
                    cause.  The tax imposed by this paragraph                         
                    shall be paid by any organization manager who                     
                    participated in the excess benefit                                
                    transaction.                                                      
                    (b) Additional Tax on the Disqualified Person.–-In                
               any case in which an initial tax is imposed by                         
               subsection (a)(1) on an excess benefit transaction and                 
               the excess benefit involved in such transaction is not                 
               corrected within the taxable period, there is hereby                   
               imposed a tax equal to 200 percent of the excess                       
               benefit involved.  The tax imposed by this subsection                  
               shall be paid by any disqualified person referred to in                
               subsection (f)(1) with respect to such transaction.                    
                    (c) Excess Benefit Transaction; Excess                            
               Benefit.-–For purposes of this section--                               
                         (1) Excess benefit transaction.--                            
                              (A) In general.--The term                               
                         “excess benefit transaction” means                           
                         any transaction in which an                                  
                         economic benefit is provided by an                           
                         applicable tax-exempt organization                           
                         directly or indirectly to or for                             





Page:  Previous  53  54  55  56  57  58  59  60  61  62  63  64  65  66  67  68  69  70  71  72  Next

Last modified: May 25, 2011