The Purpose of the Excise Tax Imposed on a Private

question 141

True/False

The purpose of the excise tax imposed on a private foundation for failure to distribute sufficient levels of income is to motivate the foundation to distribute more of its income for application to exempt purposes and thus be classified as a feeder organization.

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Definitions:

Breached

The act of failing to fulfill the terms of a contract, agreement, or duty.

Tortfeasor

A person who commits an intentional or through-negligence tort that causes a harm or loss for which a civil remedy may be sought.

Fraudulent Misrepresentation

A false statement of fact made by one party to another, with the intention of inducing the latter into entering a contract, resulting in harm or loss.

Relied Upon

Depended on or trusted, often in the context of information or services that are considered to be dependable.