Tax Exempt Foundations

Archive Report

Federal Tax Exemption and Tax Avoidance

Congress and Question of Tax-Exempt Foundations

The Tax-Exempt position of foundations and trusts organized on a non-profit basis but actively engaged in profit-making financial and business operations will be carefully scrutinized by the 81st Congress. More than a year ago the House Ways and Means Committee inquired into the activities of various college alumni foundations which were operating competitive business enterprises free of income tax. Hearings conducted recently by a Senate subcommittee headed by Sen. Tobey (R., N. H.) disclosed that several trusts, organized directly or indirectly by the president of Textron Incorporated, had made phenomenal profits through intricate financial deals with that corporation and its subsidiaries and, while claiming exemption from all federal income taxes, had donated only relatively ...

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