Page:United States Statutes at Large Volume 83.djvu/562

 534

PUBLIC LAW 91-172-DEC. 30, 1969

Ante, p. 527.

Anfe, p. 502,

!

,

Ante, p. 527. Post,

p. 558.

Ante, p. 528.

Post,

p. 553.

68A Stat. 85 26 USC 302.

[83 STAT.

was not at the time of such execution a prohibited transaction (within the meaning of section 503(b) or the corresponding provisions of prior law); (D) the use of goods, services, or facilities which are shared by a private foundation and a disqualified person until taxable years beginning after December 31, 1979, if such use is pursuant to an arrangement in effect before October 9, 1969, and such arrangement was not a prohibited transaction (within YiQ, meaning of section 503(b) or the corresponding provisions of prior law) at the time it was made and would not be a prohibited transaction if such section continued to apply; and (E) the use of property in which a private foundation and a disqualified person have a joint or common interest, if the interests of both in such property were acquired before October 9, 1969. ^g^ SECTION 4 942.—In the case of organizations organized before May 27, 1969, section 4942 shall— (A) for all purposes other than the determination of the minimum investment return under section 4942(j)(3)(B) (ii), for taxable years beginning before January 1, 1972, apply without regard to section 4942(e) (relating to minimum investment return), and for taxable years beginning in 1972, 1973, and 1974, apply with an applicable percentage (as prescribed in section 4942(e)(3)) which does not exceed \y2 percent, 5 percent, and 51/^ percent, respectively; (B) not apply to an organization to the extent its income is required to be accumulated pursuant to the mandatory terms (as in effect on May 26, 1969, and at all times thereafter) of an instrument executed before May 27, 1969, with respect to the transfer of income producing property to such organization, except that section 4942 shall apply to such organization if the organization would have been denied exemption if section 504(a) had not been repealed by this Act, or would have had its deductions under section 642(c) limited if section 681(c) had uot been repealed by this Act. In applying the preceding sentence, in addition to the limitations contained m section 504(a) or 681(c) before its repeal, section 504(a)(1) or 681(c)(1) shall be treated as not applying to an organization to the extent its income is required to be accumulated pursuant to the mandatory terms (as in effect on January 1, 1951, and at all times thereafter) of an instrument executed before January 1, 1951, with respect to the transfer of income producing property to such organization before such date, if such transfer was irrevocable on such date; (C) apply to a grant to a private foundation described in section 4942(g)(1)(A) (ii) which is not described in section 4942(g)(1)(A)(i), pursuant to a written commitment which was binding on May 26, 1969, and at all times thereafter, as if such grant is a grant to an operating foundation (as defined in section 4942(]) (3)), if sudi grant is made for one or more of the purposes described in section 170(c)(2)(B) and is to be paid out to such private foundation on or before December 31, 1974; (D) apply, for purposes of section 4942(f), in such a manner as to treat any distribution made to a private foundation in redemption of stock held by such private foundation in a business enterprise as not essentially equivalent to a dividend under section 302(b)(1) if such redemption is described in paragraph (2)(B) of this subsection; and

�