Charitable Trust and Wholly-Owned Corporation May File a Single Form 990

In PLR 201131030, the Department of the Treasury recently ruled that a community trust may operate a charitable corporation as a component of the trust. In the instant case, The Trust had founded the Corporation and both the Corporation and Trust had been filing separate Forms 990.  The Trust wished to file a single Form 990 in the future in order to create administrative efficiencies and cost savings. In its ruling, the Department of the Treasury stated:

Trust will be treated as a single entity under section 1.170A-9T(f)(11)(i) of the regulations. In addition, Corporation will be treated as a component part of the Trust under section 1.170A-9T(f)(11)(ii). Funds created within the Trust or Corporation, if they otherwise meet the requirements of section 1.170A-9T(f)1(i) will be treated as component parts of a single community trust under section 1.170A-9T(f)(11).

PLR 201131030 (May 9, 2011), Tax Analysts Doc 2011-17061.

Special thanks to Jim Hillhouse (WealthCounsel) for bringing this article to my attention.