494
PUBLIC LAW 91-172-DEC. 30, 1969
[83 STAT.
foundation in which the contribution or bequest is received by the foundation from such person. I n the case of a trust, the term 'substantial contributor' also means the creator of the trust. " (B) SPECIAL RULES.—For purposes of subparagraph "(i) each contribution or bequest shall be valued at fair market value on the date it was received, "(ii) in the case of a foundation which is in existence on October 9, 1969, all contributions and bequests received on or before such date shall be treated (except for purposes of clause (i)) as if received on such date, "(iii) an individual shall be treated as making all contributions and bequests made by his spouse, and "(iv) any person who is a substantial contributor on any date shall remain a substantial contributor for all subsequent periods. "(3) EEGULATIONS.—For purposes of tjiis section, the determination as to whether and to what extent there would have been any increase in tax shall be made in accordance with regulations prescribed by the Secretary or his delegate. "(e) VALUE
OF ASSETS.—For purposes of subsection
(c), the
value of the net assets shall be determined at whichever time such value is higher: (1) the first day on which action is taken by the organization which culminates in its ceasing to be a private foundation, or (2) the date on which it ceases to be a private foundation. "(f)
Post, p. 550.
Post. p. 523.
26 USC r5'oi^^"
LIABILITY I N CASE OF TRANSFERS OF ASSETS FROM PRIVATE
FOUNDATION.—For purposes of determining liability for the tax imposed by subsection (c) in the case of assets transferred by the private foundation, such tax shall be deemed to have been imposed on the first day on which action is taken by the organization which culminates in its ceasing to be a private foundation. " (g) ABATEMENT OF TAXES.—The Secretary or his delegate may abate the unpaid portion of the assessment of any tax imposed by subsection (c), or any liability in respect thereof, if— "(1) the private foundation distributes all of its net assets to one or more organizations described in section 1 7 0 (b)(1)(A) (other than in clauses (vii) and (viii)) each of which has been in existence and so described for a continuous period of at least 60 calendar months, or "(2) following the notification prescribed in section 6104(c) to the appropriate State officer, such State officer within one year notifies the Secretary or his delegate, in such manner as the Secretary or his delegate may by regulations prescribe, that corrective action has been initiated pursuant to State law to insure that the assets of such private foundation are preserved for such charitable ^^ other purposes specified in section 501(c)(3) as may be ordered or approved by a court of competent jurisdiction, and upon completion of the corrective action, the Secretary or his delegate receives certification from the appropriate State officer that such action has resulted in such preservation of assets. "SEC. 508. SPECIAL RULES WITH RESPECT TO SECTION 501(c)(3) ORGANIZATIONS. " (a) N E W ORGANIZATIONS M U S T NOTIFY SECRETARY T H A T THE Y ARE APPLYING FOR EECOGNITION OF SECTION 501(c)(3) STATUS.—
Except as provided in subsection (c), an organization organized after October 9, 1969, shall not be treated as an organization described in section 501(c)(3)—
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