State laws satisfying the requirements of Treas. Reg. Section 1.501(c)(3)-1(b)(4)
Treasury Regulations (Treas. Reg.) Section 1.501(c)(3)-1(b)(4) includes requirements for Section 501(c)(3) organizations related to the distribution of assets upon dissolution (dissolution requirements). Revenue Procedure 82-2 identified the states and circumstances in which an organization could satisfy these requirements by operation of state law. The conclusions in the revenue procedure were based on state laws in effect at the time of its publication, many of which have since changed. Because Rev. Proc. 82-2 no longer provides an accurate list of the states with laws that operate to ensure the distribution of assets for exempt purposes upon dissolution, it has been obsoleted by Rev. Proc. 2024-22 on May 24, 2024.
On April 23, 2024, Associate Chief Counsel, Employee Benefits, Exempt Organizations and Employment Taxes (ACC:EEE) issued Program Manager Technical Advice Memorandum 2024-02 (PMTA), with updated guidance on state laws that satisfy the dissolution requirements of Treas. Reg. Section 1.501(c)(3)-1(b)(4). The PMTA was issued to the Tax Exempt and Government Entities (TEGE) Exempt Organizations Rulings and Agreements and Examinations offices, which will use the advice in processing applications for recognition of exemption and undertaking examinations. The PMTA includes tables identifying states with laws that operate to ensure the dedication of assets to exempt purposes. Separate tables are provided for nonprofit corporations, inter vivos charitable trusts, testamentary charitable trusts, and unincorporated nonprofit associations.
Subsequent changes to state law by statute or court decision may affect the accuracy of this information.
State laws satisfying the Section 508(e) private foundation governing instrument requirements
Internal Revenue Code (IRC) Section 508(e) includes requirements for the governing instruments of private foundations exempt from taxation under IRC Section 501(a). Rev. Rul. 75-38 identified 48 states and the District of Columbia as jurisdictions with statutory provisions in effect at the time of its publication that satisfied the requirements of IRC Section 508(e) and noted certain exceptions. The conclusions in the revenue ruling were based on state laws in effect at the time of its publication, a number of which have since changed. Because Rev. Rul. 75-38 no longer provides an accurate list of the states with statutory provisions that satisfy the requirements of IRC Section 508(e) or of such exceptions, it has been obsoleted by Rev. Rul 2024-10 on May 24, 2024.
On April 23, 2024, ACC:EEE issued PMTA 2024-03 with updated guidance on state laws that satisfy the private foundation governing instrument requirements of IRC Section 508(e). The PMTA was issued to the TEGE Exempt Organizations Rulings and Agreements and Examinations offices, which will use the advice in processing applications for recognition of exemption and undertaking examinations. The PMTA includes a table identifying whether and under what circumstances each state has enacted laws satisfying the requirements of IRC Section 508(e) for nonprofit corporations, trusts, and unincorporated nonprofit associations covered by those laws and exceptions. Subsequent changes to state law by statute or court decision may affect the accuracy of this information.
