Part III. Supplemental Information

Use Part III to provide the narrative information required in Part I, lines 2e, 3, and 6c, and Part II, line 2e. Also use Part III to provide additional narrative explanations and descriptions as necessary to support or supplement any responses in Part I or II. Identify the specific part and line(s) that the response supports. Part III may be duplicated if more space is needed.

An organization that completes Part I doesn’t complete Part II.

Part II. Sale, Exchange, Disposition, or Other Transfer of More Than 25% of the Organization’s Assets

If an organization answered “Yes” to Form 990, Part IV, line 32, or Form 990-EZ, line 36, because it made a significant disposition of net assets during the tax year, it must complete Part II. A significant disposition of the organization’s net assets includes a sale, exchange, disposition, or other transfer of more than 25% of the FMV of its net assets during the tax year, regardless of whether the organization received full and adequate consideration. A significant disposition of net assets involves:

1. One or more dispositions during the organization’s tax year amounting to more than 25% of the FMV of the organization’s net assets as of the beginning of its tax year; or

2. One of a series of related dispositions or events commenced in a prior year that, when combined, comprise more than 25% of the FMV of the organization’s net assets as of the beginning of the tax year when the first disposition in the series was made. Whether a significant disposition occurred through a series of related dispositions or events depends on the facts and circumstances in each case.

A significant disposition of net assets may result from either an expansion or a contraction of operations. Examples of the types of transactions required to be reported in Part II as significant dispositions of net assets include the following.

• Taxable or tax-free sales or exchanges of exempt assets for cash or other consideration (such as a social club described in section 501(c)(7) selling land or assets it had used to further its exempt purposes).

• Sales, contributions, or other transfers of assets to establish or maintain a partnership, joint venture, or corporation (for-profit or nonprofit) regardless of whether such sales or transfers are governed by section 721 or section 351, and whether or not the transferor receives an ownership interest in exchange for the transfer.

• Sales of assets by a partnership or joint venture in which the organization has an ownership interest.

• Transfers of assets pursuant to a reorganization in which the organization is a surviving entity.

The following types of situations aren’t required to be reported in Part II.

• The change in composition of publicly traded securities held in an exempt organization’s passive investment portfolio.