Exempt Organizations Advisory - IRS Exempt Organizations Director Outlines 2006 Priorities

Lois Lerner, newlyappointed director of the Exempt Organizations Division of the Internal Revenue Service, spoke at a meeting of the American Bar Association’s Section of Taxation on February 3rd and outlined the following focus areas for the Exempt Organizations Division in 2006:

• sending letters to tax-exempt hospitals to collect information about their compensation and community benefit practices;
• the use of conservation and façade easements;
• charitable remainder trusts;
• accommodation parties (i.e., tax-exempt entities that participate in tax shelters);
• credit counseling organizations;
• down payment assistance services; and
• executive compensation.

The IRS is expected to issue an interim report later this year on compensation practices, as well as a report on political activities of tax-exempt organizations.

For more information on this topic, please contact Catherine W. Wilkinson, Suzanne Ross McDowell, or the Steptoe attorney(s) with whom you usually work.

The Exempt Organization Advisory is a general summary of the law and is not intended as specific legal advice for any organization.

Internal Revenue Service - Circular 230 Disclosure: As provided for in Treasury regulations, advice (if any) relating to federal taxes that is contained in this communication (including attachments) is not intended or written to be used, and cannot be used, for the purpose of (1) avoiding penalties under the Internal Revenue Code or (2) promoting, marketing or recommending to another party any plan or arrangement addressed herein.

Questions and comments about the Exempt Organizations Advisory are always welcome and should be sent to bstone@steptoe.com.