Rhode Island General Laws 7-6-8. Limiting powers of certain corporations
(a) No corporation that is a “private foundation” as defined in § 509(a) (26 U.S.C. § 509(a)) of the Internal Revenue Code of 1954 shall:
(1) Engage in any act of “self-dealing”, as defined in § 4941(d) (26 U.S.C. § 4941(d)) of the Internal Revenue Code of 1954, which would give rise to any liability for the tax imposed by § 4941(a) (26 U.S.C. § 4941(a)) of the code;
(2) Retain any “excess business holdings”, as defined in § 4943(c) (26 U.S.C. § 4943(c)) of the Internal Revenue Code of 1954, which would give rise to any liability for the tax imposed by § 4943(a) (26 U.S.C. § 4943(a)) of the code;
(3) Make any investment which would jeopardize the carrying out of any of the exempt purposes of the trust, within the meaning of § 4944 (26 U.S.C. § 4944) of the Internal Revenue Code of 1954, so as to give rise to any liability for the tax imposed by § 4944(a) (26 U.S.C. § 4944(a)) of the code; and
(4) Make any “taxable expenditures”, as defined in § 4945(d) (26 U.S.C. § 4945(d)) of the Internal Revenue Code of 1954, which would give rise to any liability for the tax imposed by § 4945(a) (26 U.S.C. § 4945(a)) of the code.
Terms Used In Rhode Island General Laws 7-6-8
- Articles of incorporation: means the original or restated articles of incorporation or articles of consolidation and all amendments to it, including articles of merger and special acts of the general assembly creating corporations and/or entities. See Rhode Island General Laws 7-6-2
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- Jurisdiction: (1) The legal authority of a court to hear and decide a case. Concurrent jurisdiction exists when two courts have simultaneous responsibility for the same case. (2) The geographic area over which the court has authority to decide cases.
(b) Each corporation which is a “private foundation” as defined in § 509(a) (26 U.S.C. § 509(a)) of the Internal Revenue Code of 1954 shall distribute for the purposes specified in articles of organization for each taxable year, amounts at least sufficient to avoid liability for the tax imposed by § 4942(a) (26 U.S.C. § 4942(a)) of the code.
(c) The provisions of subsections (a) and (b) of this section do not apply to any corporation to the extent that a court of competent jurisdiction determines that the application would be contrary to the terms of the articles of organization or other instrument governing the corporation or governing the administration of charitable funds held by it and that the articles of incorporation may not properly be changed to conform to the sections.
(d) All references to sections of the Internal Revenue Code of 1954 include future amendments to the sections and corresponding provisions of future internal revenue laws.
History of Section.
P.L. 1984, ch. 380, § 1; P.L. 1984, ch. 444, § 1.