Instructions for Form 8734
Support Schedule for Advance Ruling Period
Section references are to the Internal Revenue Code unless otherwise noted.
Department of the Treasury Internal Revenue Service
General Instructions When To File 90 days after the Specific Instructions File Form 8734 within Important:
990-EZ), Organization Exempt Under Section 501(c)(3), and its separate Instructions before you complete this form. Twenty-four hours a day, seven days a week, you can: 1. Access the IRS website by computer at www.irs.gov and download these items or 2. Order them by calling 1-800-TAX-FORM (1-800-829-3676). · The terms "you" and "your" refer to the organization. "We" and "us" refer to the Internal Revenue Service (IRS).
· Get Schedule A (Form 990 or
end of your advance ruling period (90 days after the end of Year 5). By doing so, you will continue to be treated as a publicly supported organization until we make a final decision.
The instructions that follow are keyed to items in the heading of Form 8734.
If we do not receive your Form 8734, we will presume that you are a private foundation and publish that fact in our publications. If you file Form 8734 after this period, we will consider the information you provide to determine whether you are a publicly supported organization. If you were always a publicly supported organization, we will correct your status. If you are not eligible to be reclassified, you will continue to be listed as a private foundation.
For tax years beginning and ending. The line that asks about information for beginning and ending tax years refers to the first tax year when your advance ruling period began and the fifth tax year when your advance ruling period ended. For example, if a calendar year organization's advance ruling period began September 15, 1999, and ended December 31, 2003, then it would provide this information. Your exemption letter will inform TIP you about when your advance ruling period began and ended. If you are not sure about when your advance ruling period began and ended, call the IRS Exempt Organizations Customer Account Services toll free at 1-877-829-5500. Name and address. If you operate under a name different from your legal name, give your legal name but identify your alternate name after the legal name by writing ``aka'' (also known as) and the alternate name. Include the suite, room, or other unit number after the street address. If the Post Office does not deliver mail to the street address and you have a P.O. box, show the box number instead of the street address. For foreign addresses, enter information in the following order: city, province or state, and the name of the country. Follow the foreign country's practice in placing the postal code in the address. Please do not abbreviate the country name. If you change your address after the form is filed, use Form 8822, Change of Address, to notify the IRS of the new address. Employer identification number. You should have only one Federal employer identification number (EIN). If you have more than one and have not been advised which to use, notify the Internal Revenue Service Center, Attention: Entity Control, Stop 6273, Ogden, UT 84201-0027. State what numbers you have, the name and address to which each number was assigned, and the address of your principal office. We will advise which number to use.
Purpose of Form
Use Form 8734, Support Schedule for Advance Ruling Period, at the end of your five-year advance ruling period, to provide financial information supporting your qualification as a publicly supported organization under section 509(a). When your advance ruling period ends, unless you obtain a final determination that you are a publicly supported organization, you will be responsible for filing an annual return as a private foundation for your sixth tax year and thereafter while you are a private foundation. Note: Form 8734 may also be filed by a private foundation at the end of its 60-month termination period under section 507(b)(1)(B) in connection with its request for a determination that it qualifies as a publicly supported organization.
If you have questions and/or need help completing Form 8734, call IRS Exempt Organizations Customer Account Services toll free at 1-877-829-5500, between 8:00 a.m. and 6:30 p.m. Eastern time, Monday through Friday.
A submitted Form 8734 is not a publicly available document. See Regulation section 301.6104(a)-1(i)(5).
Form 8734 must be completed on the cash method of accounting. For example, if a grantor makes a grant to an organization payable over a term of years, such grant will be includible in the support fraction of the grantee organization only when and to the extent amounts payable under the grant are received by the grantee. If you use the accrual method of accounting, a worksheet such as the one in Part IV-A of the Instructions for Schedule A (Form 990 or 990-EZ) may be used to convert any revenue account from an accrual basis to a cash basis.
Who Should File
A charitable organization described in section 501(c)(3) should file Form 8734 when it seeks to establish at the end of its advance ruling period that it is a publicly supported organization under sections 509(a)(1) and 170(b)(1)(A)(vi) or section 509(a)(2).
Where To File
The completed Form 8734 should be sent to the: Internal Revenue Service P.O. Box 192 Covington, KY 41012
Show your name, employer identification number, and "Form 8734" at the top of any attachments you include with your Form 8734.
Cat. No. 35120F
Telephone number. Enter a telephone number that we can call during normal business hours to obtain information about your finances and activities. If you do not have a telephone number, enter the telephone number of your official who can provide such information. Email and fax number. If you have an email address or a fax number, enter this information. Calendar year (or fiscal year beginning in). This refers to your annual accounting period. For example, a calendar year accounting period is the 12-month period that begins on January 1st and ends on December 31st. If you were formed after the beginning of an accounting period, your first year (Year 1) will be less than the full 12-month period. Your determination letter will state the accounting period that you adopted. Lines 1 through 14 of this form TIP are comparable to lines 15 through 28 of Schedule A (Form 990 or 990-EZ). If you filed Schedule A for Year 4, show the information you reported in Part IV-A of Schedule A in the spaces for Year 4 through Year 1 in the applicable lines of Form 8734. Then enter your information for Year 5 on the applicable lines of Form 8734. Please note, however, that the lists that you prepared for your records for lines 26b, 27a, 27b, and 28 of Schedule A for Year 4 through Year 1 must now be attached to Form 8734 in support of lines 12b, 13a, 13b, and 14. Be sure you change the line numbers used in support of Schedule A to the line numbers used for Form 8734, and include the information for Year 5. The examples that follow are comparable to the examples given in Schedule A except that these examples reflect the 5-year advance ruling period instead of a 4-year period in Schedule A. Line 12. Organization meeting the section 509(a)(1) and 170(b)(1)(A)(vi) public support test. This example shows that you meet the 331/3%-of-support test. Example. X organization reported the following amounts in its Support Schedule for the 5-year period, Year 5 through Year 1:
Line 1 3 4 10 Gross receipts from admissions, etc. Dividends & interest . . . . . . . . . . . Line 9 minus line 3 . . . . . . . . . . . b Total of contributions exceeding the 2% limitation . . . . . . . . . . . . . . . (f) Total Gifts, grants & contributions . . . . . . $300,000 100,000 300,000 600,000 12,000 98,000
Line 12b Example
Amount on line 12a of the Support Schedule (2% limitation) . . . . . . . . . . . . . . . . Contributors whose total gifts from Year 5 through Year 1 were in excess of the 2% limitation (a) Name (b) Year 5 (c) Year 4 (d) Year 3 (e) Year 2 (f) Year 1 (g) Total $12,000
(h) Excess contributions (col. (g) less the 2% limitation) $50,000 3,000
XYZ Foundation Apple Office Supply Plum Corporation John Smith Sue Adams Apple Trade Assoc. $5,000 5,000 $10,000 $12,000
$16,000 $20,000 $27,000
4,000 8,000 15,000 $98,000
Total (Carry the total of column (h) to line 12(b) of the Support Schedule.
509(a)(1)/170(b)(1)(A)(vi) public support test as follows:
Total support (line 10): . . . . . . . . . . . . $600,000 Direct contributions: Total direct contributions from persons who contributed less than 2% of total support Total direct contributions from six donors, each of whom gave more than 2% ($12,000) of total support . . . . . . . . . . . Indirect contributions from the general public: United Fund . . . . . . . . . . . . . . . . . . . Grant from Y City . . . . . . . . . . . . . . . . 40,000 40,000 50,000
Section 509(a)(1)/170(b)(1)(A)(vi) computation: Line 12c Total support . . . . . . . . . . . . $600,000 Line 12d Less total of lines: 4 5 8 . . . $300,000 . . . . . . 0 0 98,000 $398,000
12b . . . 170,000
Line 12e Total public support . . . . . . . . $202,000 Line 12f Public support percentage (line 12e divided by line 12c -- $202,000/ $600,000) . . . . . . . . . . . . . . . . . . .
Total gifts, grants & contributions . . . . . . $300,000 Total direct contributions from six donors, each of whom gave more than 2% of total support . . $170,000 2% limitation for six donors: (2% × $600,000 × 6) . . . . . . . . . . . Less: Direct contributions in excess of 2% of total support . . Total public support . . . . . . . . 72,000 98,000 $202,000
12a 2% of line 10 (2% limitation) . . . . . .
The X organization determined whether or not it met the section
Since X organization received more than 331/3% of its total support for the period from public sources, it qualifies as a section 509(a)(1)/170(b)(1)(A)(vi) publicly supported organization. Facts and circumstances test. If you do not meet the 331/3% public support test but received at least 10% of your support from the general public, other publicly supported organizations, or governmental units for your first five years, you may qualify as a publicly supported section 509(a)(1) and 170(b)(1)(A)(vi) organization. If you believe you are a publicly supported organization according to applicable regulations, you must attach a detailed statement of the facts upon which you base your conclusion. Your facts and circumstances may include (1) the amount of support you received from the general public, governmental units, or public charities, (2) whether you have a continuous and bona fide program for solicitation of funds from
the general public, governmental units, or public charities, and (3) all other facts and circumstances, including the public nature of your governing board, the extent to which your facilities or programs are publicly available, the extent to which your dues encourage membership, and whether your activities are likely to appeal to persons having a broad common interest or purpose. For additional information about the 10% facts and circumstances test, see Pub. 557, Tax-Exempt Status for Your Organization, and Regulations section 1.170A-9(e)(3). Line 12b. Contributions in excess of the 2% limitation. An example of a list for line 12b showing the name of and amount contributed by each person (other than a governmental unit or publicly supported organization) whose total gifts for the advance ruling period exceeded the amount shown in line 12a is shown on page 2. Line 13. Organization meeting the section 509(a)(2) public support tests. The following example illustrates the public support tests. Example. Organization T reported the following amounts in its Support Schedule for the 5-year period, Year 5 through Year 1:
Line 1 2 3 4 9 Gifts, grants & contributions . . . . . . Membership fees . . . . . . . . . . . . Gross receipts from admissions, merchandise, etc. . . . . . . . . . . . . Gross income from interest, dividends, etc. . . . . . . . . . . . . . . (f) Total $45,000 50,000 25,000 80,000 25,000 20,000
Line 13a Example
(a) Name David Smith Anne Parker Total $5,000 $5,000 $6,000 (b) Year 5 $5,000 (c) Year 4 5,000 (d) Year 3 6,000 $8,000 $8,000 10,000 $10,000 (e) Year 2 (f) Year 1 (g) Total $16,000 $18,000 $34,000
Enter the total for each year of columns (b) through (f) on line 13a of the Support Schedule. Enter the total of column (g) on the line 13a entry space for line 13d of the Support Schedule.
Total of lines 1 through 8 . . . . . . . . $200,000 b Excess gross receipts from nondisqualified persons . . . . . . . .
13a Gifts from disqualified persons . . . .
income percentage was 40.0%. Therefore, it did not meet the second part of the section 509(a)(2) test -- the not-more-than-one-third of total support from gross investment income and net unrelated business taxable income. Since T did not satisfy both of the one-third tests of section 509(a)(2), it failed the section 509(a)(2) public support test for its five-year period. Line 13a. Contributions, membership fees, and gross receipts from disqualified persons. The example above shows a list of the names and total amounts received in each year from each "disqualified person" for amounts that were included in lines 1, 2, and 3 of Form 8734. Line 13b. Gross receipts from other than disqualified persons. The example below is a list showing the name of, and amount received for each year that was more than the larger of: 1. The amount on line 11 for the year or 2. $5,000 for any amount included in line 3 that was received from each person (other than "disqualified persons") for Year 5. Attach similar lists to determine excess amounts for Years 4, 3, 2, and 1 entry lines of 13b. Line 13b Example
An officer, director, or trustee who is authorized to sign must sign Form 8734. Show the title or authority of the signer and the date. Paperwork Reduction Act Notice We ask for the information on this form to carry out the Internal Revenue laws of the United States. You are required to give us the information. We need it to ensure that you are complying with these laws. You are not required to provide the information requested on a form that is subject to the Paperwork Reduction Act unless the form displays a valid OMB control number. Books or records relating to a form or its instructions must be retained as long as their contents may become material in the administration of any Internal Revenue law. The rules governing the confidentiality of Form 8734 are in section 6104. The time needed to complete and file this form will vary depending on individual circumstances. The estimated average time is:
Recordkeeping . . . . . . . . 29 hr., 39 min. Learning about the law or the form . . . . . . . . . . . . . 1 hr., 27 min. Preparing the form . . . . . 2 hr., 56 min. Copying, assembling, and sending the form to the IRS . . . . . . . . . . . . . . . . . 16 min.
T determined whether it met the one-third tests of section 509(a)(2) in the following computation:
Section 509(a)(2) computation: Line 13c Add: Amounts from column (f), lines 1, 2, 3, 6, and 7 . . . . . . . . . . 13d Total of line 13a . . . . . . . $25,000 Total of line 13b . . . . . . . 20,000 45,000 13e Public support (line 13c minus line 13d total) . . . . $75,000 13f Total support (line 9, column (f)) . . . . . . . . . . $200,000 13g Public support percentage (line 13e divided by line 13f -- $75,000/$200,000) 37.50% 13h Investment income percentage (line 4 divided by line 13f -- $80,000/ $200,000) . . . . . . . . . . . 40.0%
(b) (c) (d) Amount Amount Enter received on the in line 11 larger Year 5 for Year of 5 column (c) or $5,000
(e) Year 5 Excess (column (b) less column (d))
Word Processing, Inc. $25,000
T received 37.50% of its total support from the public and thus met the more-than-one-third test of public support to total support. T's investment
If you have comments concerning the accuracy of these time estimates or suggestions for making this form simpler, we would be happy to hear from you. You can write to the Tax Products Coordinating Committee, Western Area Distribution Center, Rancho Cordova, CA 95743-0001. Do not send the form to this address. Instead, see Where To File on page 1.
Enter the total for column (e) on line 13b for the Year 5 entry space . . . . . $20,000