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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
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