Page:United States Statutes at Large Volume 120.djvu/1129

 120 STAT. 1098

26 USC 4963.

PUBLIC LAW 109–280—AUG. 17, 2006

‘‘(1) JOINT AND SEVERAL LIABILITY.—If more than one person is liable under paragraph (1) or (2) of subsection (a) with respect to a distribution described in subsection (a), all such persons shall be jointly and severally liable under such paragraph with respect to such distribution. ‘‘(2) LIMIT FOR MANAGEMENT.—With respect to any one distribution described in subsection (a), the maximum amount of the tax imposed by subsection (a)(2) shall not exceed $10,000. ‘‘(d) PERSON DESCRIBED.—A person is described in this subsection if such person is described in section 4958(f)(7) with respect to a donor advised fund.’’. (b) CONFORMING AMENDMENTS.— (1) Section 4963 is amended by inserting ‘‘4966, 4967,’’ after ‘‘4958,’’ each place it appears in subsections (a) and (c). (2) The table of subchapters for chapter 42 is amended by adding at the end the following new item: ‘‘SUBCHAPTER G—DONOR

26 USC 4963 note.

ADVISED FUNDS’’.

(c) EFFECTIVE DATE.—The amendments made by this section shall apply to taxable years beginning after the date of the enactment of this Act. SEC. 1232. EXCESS BENEFIT TRANSACTIONS INVOLVING DONOR ADVISED FUNDS AND SPONSORING ORGANIZATIONS.

(a) DISQUALIFIED PERSONS.— (1) IN GENERAL.—Paragraph (1) of section 4958(f) is amended by striking ‘‘and’’ at the end of subparagraph (B), by striking the period at the end of subparagraph (C) and inserting a comma, and by adding after subparagraph (C) the following new subparagraphs: ‘‘(D) which involves a donor advised fund (as defined in section 4966(d)(2)), any person who is described in paragraph (7) with respect to such donor advised fund (as so defined), and ‘‘(E) which involves a sponsoring organization (as defined in section 4966(d)(1)), any person who is described in paragraph (8) with respect to such sponsoring organization (as so defined).’’. (2) DONORS, DONOR ADVISORS, AND INVESTMENT ADVISORS TREATED AS DISQUALIFIED PERSONS.—Section 4958(f) is amended by adding at the end the following new paragraphs: ‘‘(7) DONORS AND DONOR ADVISORS.—For purposes of paragraph (1)(E), a person is described in this paragraph if such person— ‘‘(A) is described in section 4966(d)(2)(A)(iii), ‘‘(B) is a member of the family of an individual described in subparagraph (A), or ‘‘(C) is a 35-percent controlled entity (as defined in paragraph (3) by substituting ‘persons described in subparagraph (A) or (B) of paragraph (7)’ for ‘persons described in subparagraph (A) or (B) of paragraph (1)’ in subparagraph (A)(i) thereof). ‘‘(8) INVESTMENT ADVISORS.—For purposes of paragraph (1)(F)— ‘‘(A) IN GENERAL.—A person is described in this paragraph if such person— ‘‘(i) is an investment advisor,

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