Page:United States Statutes at Large Volume 83.djvu/533

 83 STAT. ]

PUBLIC LAW 91-172-DEC. 30, 1969

505

" (B) any amount paid to acquire an asset used (or held for use) directly in carrying out one or more purposes described in section 1 7 0 (c)(2)(B). _ Post, p. 553. " (2) CERTAIN SET-ASIDES.—Subject to such terms and conditions as may be prescribed by the Secretary or his delegate, an amount set aside for a specific project which comes within one or more purposes described in section 170(c)(2)(B) may be treated as a qualifying distribution, but only if, at the time of the set-aside, the private foundation establishes to the satisfaction of the Secretary or his delegate that— " (A) the amount will be paid for the specific project within 5 years, and " (B) the project is one which can be better accomplished by such set-aside than by immediate payment of funds. For good cause shown, the period for paying the amount set aside may be extended by the Secretary or his delegate. " (3) CERTAIN CONTRIBUTIONS TO SECTION 501(C)(3) ORGANIZA-

TIONS.—For purposes of this section, the term 'qualifying distribution' includes a contribution to a section 501(c)(3) organization described in paragraph (1)(A)(i) or (ii) if— " (A) not later than the close of the first taxable year after its taxable year in which such contribution is received, such organization makes a distribution equal to the amount of such contribution and such distribution is a qualifying distribution (within the meaning of paragraph (1) or (2), without regard to this paragraph) which is treated under subsection (h) as a distribution out of corpus (or would be so treated if such section 501(c)(3) organization were a private foundation which is not an operating foundation), and " (B) the private foundation making the contribution obtains adequate records or other sufficient evidence from such organization showing that the qualifying distribution described in subparagraph (A) has been made by such organization. " (h) TREATMENT or QUALIFYING DISTRIBUTIONS.—

"(1) IN GENERAL.—Except as provided in paragraph (2), any qualifying distribution made during a taxable year shall be treated as made— " (A) first out of the undistributed income of the immediately preceding taxable year (if the private foundation was subject to the tax imposed by this section for such preceding taxable year) to the extent thereof, " (B) second out of the undistributed income for the taxable year to the extent thereof, and "(C) then out of corpus. For purposes of this paragraph, distributions shall be taken into account in the order of time in which made. " (2) CORRECTION OF DEFICIENT DISTRIBUTIONS FOR PRIOR TAXABLE YEARS, ETC.—In the case of any qualifying distribution which

(under paragraph (1)) is not treated as made out of the undistributed income of the immediately preceding taxable year, the foundation may elect to treat any portion of such distribution as made out of the undistributed income of a designated prior taxable year or out of corpus. The election shall be made by the foundation at such time and in such manner as the Secretary or his delegate shall by regulations prescribe.

o^^nlVn^^^' 26 USC 501.

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