Qualified Opportunity Zones Legislation Introduced

• Published date: 01 February 2020
• DOI: http://doi.org/10.1002/npc.30690
• Date: 01 February 2020

Bruce R. Hopkins’ NONPROFIT COUNSEL

8 February 2020 THE LAW OF TAX-EXEMP T ORGANIZATIONS MONTHLY

Bruce R. Hopkins’ Nonpr ofit Counsel DOI:10.10 02/n pc

ailments that face our society, and by supporting chari-

ties, we make our communities and our country a better

place for Americans from all walks of life.” He added

that his legislation would “allow everyone to deduct

charitable giving, regardless of itemizing status while

increasing support for the great work our faith-based

and charitable organizations contribute.” ◆

QUALIFIED OPPORTUNITY

ZONES LEGISLATION

INTRODUCED

Legislation was introduced on December 6 to augment

the Qualified Opportunity Zones program (summarized

in the December 2018 issue). This bill is the IMPACT Act,

with the acronym standing for Improving and Reinstat-

ing the Monitoring, Prevention, Accountability, Certifica-

tion, and Transparency Provision of Opportunity Zones.

The measure includes a variety of reporting requirements

to provide for, in the language of a press release, the

“most robust and granular analysis over time on the

targeted impacts of investments in Opportunity Zones.”

At this point, there are more than 8,700 opportu-

nity zones in the nation, with more than $63 billion in

anticipated investments. The IMPACT Act is designed to

protect taxpayer privacy and preserve the ability of com-

munities to utilize a wide variety of possible investments

without overburdening entrepreneurs and local govern-

ments with unnecessary paperwork.

These rules were initially part of the opportunity

zones legislation, but procedural rules caused them to

be stripped out of the legislation when it became part

of the Tax Cuts and Jobs Act.

These zones and qualified opportunity funds are not

necessarily inherently charitable in nature but can involve

private foundations and other philanthropic organiza-

tions and efforts that overlap with the concept of eco-

nomic development in the charitable context. [7.16(e),

17.7 (supp.)] ◆

OTHER DEVELOPMENTS

◆Some sponsoring organizations are adopting a new

policy of not permitting grants from their donor-advised

funds to charities that are under investigation by the

IRS, according to an article in the December 4 Chronicle

of Philanthropy. Schwab Charitable, for example, stated

that it “follows IRS guidance and suspends grants to

501(c)(3) organizations that are under investigation, until

the investigation concludes and the organization retains

its 501(c)(3) status.” By contrast, here is the policy of the

Renaissance Charitable Foundation: “Our policy is to not

police possibilities or maybes. If a legitimate charitable

organization is registered and current with the IRS (and

the tax code set by Congress), then that organization

can receive grants from our DAFs.” [11.8]

◆Gift-acceptance policies are one thing. Naming rights

fostered by large contributions are another. Now we

have donor-name removal as an act of “symbolism.” An

article in the December 6 New York Times titled “Tufts

Removes Sackler Family Name From Facilities Over Opi-

oid Crisis” reports on the removal of Arthur M. Sackler’s

name from a Tufts University medical school’s facade.

The dean of the school termed the name removal an

“important symbolic move.” A lawyer for some Sackler

family members stated that “[w]e will be seeking to have

this improper decision reversed and are currently review-

ing all options available to us.” The president of Harvard

University said earlier in 2019 that removal of the family’s

name from buildings would be “inappropriate,” citing

“legal and contractual obligations.” It was noted that

Arthur Sackler made his contributions to the university

“long before” OxyContin was developed. ◆

Quote of the Month: In its press release concerning the

new e-filing rules for exempt organizations (see article

beginning on p. 6), the IRS stated that the Taxpayer First

Act “aims to expand and strengthen taxpayer rights and

to reform the IRS into a more taxpayer friendly agency”

and that the legislation “requires the agency to develop

a comprehensive customer service strategy, modernize

its technology and enhance its cyber security.”

Each article in the newsletter on a tax-exempt organizations law topic ends with a citation to the appropriate chapter(s) or

subchapter(s) in Hopkins, The Law of Tax-Exempt Organizations, Twelfth Edition (Wiley, 2019). This is done to provide ready access

to additional and background information concerning these articles. For example, underlying information concerning the third article

in this issue is available in Chapter 4 §§ 3 and 5 of the book; thus, the citation is referenced as [4.3, 4.5]. Likewise, each article in

the newsletter on a charitable giving law topic ends with a citation to the appropriate chapter(s) or subchapter(s) in Hopkins, The

Tax Law of Charitable Giving, Fifth Edition (Wiley, 2019 cumulative supplement). For example, underlying information concerning

the first article in this issue is available in Chapter 10 § 15(c) of the book; thus, the citation is referenced as [10.15(c)].

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ter index, as well as an index of the court opinions, IRS revenue rulings and procedures, IRS technical advice memoranda, and IRS

private letter rulings discussed in the newsletter, are available at www.brucerhopkinslaw.com. For those who have the books, the

newsletter also provides monthly updates. Both books are annually supplemented. Questions concerning nonprofit law develop-

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