Part II. Enter in column (a) the names of all organization

managers who took part in making disqualifying lobbying expenditures listed in Part I. See Tax on organization managers, earlier.

If more than one organization manager is listed in column (a), each is individually liable for the entire amount of tax in connection with the expenditure. However, the managers who are liable for the tax may prorate payment among themselves. Enter in column (c) the tax each manager will pay.

A manager filing this Form 4720 should carry the appropriate amount in column (d) to Part II, line 5.

General Instructions

Requirement. Schedule I must be completed by any Applicable organization or Disqualified person that engaged in an Excess benefit transaction, and by any fund manager who knowingly participated in the excess benefit transaction. These terms are discussed below. Each person must file separately.

Applicable organization. In general, an applicable organization is any section 501(c)(3) (except a private foundation), 501(c)(4), or 501(c)(29) organization.

Also, an applicable organization includes any organization that was a section 501(c)(3) (except a private foundation), 501(c)(4), or 501(c)(29) organization at any time during a 5-year period ending on the date of an excess benefit transaction (the lookback period).

Initial taxes. Excise taxes are imposed under section 4958 on each excess benefit transaction. If a manager receives an excess benefit from an excess benefit transaction, the manager may be liable for the tax on disqualified persons and the tax on the organization manager. The applicable organization must complete Schedule I. However, the excise tax under section 4958 is imposed on the disqualified person. The organization completing Schedule I should not report the initial tax amount on Part II and should not pay the tax liability of any disqualified person or organization manager. See Abatement, earlier, for information on abatement, refund, or relief from this tax.

Tax on disqualified persons. The tax is 25% of the excess benefit and is paid by any disqualified person who improperly benefited from the excess benefit transaction.

Instructions for Form 4720 (2025) 15

Tax on organization managers. When tax is imposed on a disqualified person for any excess benefit transaction, then tax is also imposed on any manager who knowingly participated in the excess benefit transaction. The tax is 10% of the excess benefit, not to exceed $20,000 for each transaction.

Taxable period. Taxable period means the period beginning with the date on which the excess benefit transaction occurs and ending on the earlier of:

1. The date a notice of deficiency was mailed to the disqualified person for the initial tax on the excess benefit transaction, or

2. The date on which the initial tax on the excess benefit transaction for the disqualified person is assessed.

Excess benefit transaction. An excess benefit transaction is any transaction in which:

1. An economic benefit is provided by the organization directly or indirectly to or for the use of, any disqualified person, if the value of the economic benefit provided exceeds the value of the consideration (including the performance of services) received for providing such benefit, or

2. The amount of any economic benefit provided to, or for the use of, a disqualified person is determined in whole or in part by the revenues of the organization and violates the private inurement prohibition rules (to the extent provided in regulations).

Caution: Until final regulations are issued regarding the special rules for revenue sharing transactions described in 2 above, these transactions will only be subject to section 4958 liability under the general rule described in 1 above.

Supporting organization transactions occurring after July 25, 2006. For any supporting organization, as defined in section 509(a)(3), any grant, loan, compensation, or other similar payment provided to a substantial contributor (defined later), family member, or 35% controlled entity will be considered an excess benefit transaction. The amount of the excess benefit is the amount of such grant, loan, compensation, or other similar payment. Also, any loan provided to a disqualified person that isn't an organization described in section 509(a)(1), (2), or (4) or a supported organization of the supporting organization exempt under section 501(c)(4), (5), (6) and described in the last sentence of section 509(a) is considered an excess benefit transaction.

Donor advised fund transactions occurring after August 17, 2006. Any grant, loan, compensation, or other similar payment from any donor advised fund to a donor, donor advisor, family member, or 35% controlled entity is an excess benefit transaction. The amount of the excess benefit is the amount of such grant, loan, compensation, or other similar payment.

Excess benefit. Excess benefit means the excess of the economic benefit received from the applicable organization over the consideration given (including services) by a disqualified person, except in the immediately preceding special rules where the entire amount of the grant, loan, compensation, or other similar payment is considered the excess benefit.

However, an economic benefit won't be treated as compensation for services unless the applicable organization clearly indicates its intent to treat the economic benefit (when paid) as compensation for a disqualified person's services. See Regulations section 53.4958-4(c) for more information.

Exception. Generally, section 4958 doesn't apply to any fixed payment made to a person under an initial contract. See Regulations section 53.4958-4(a)(3) for details.

Special rule. The initial and additional taxes of this section don't apply if the transaction described in 1 under Excess benefit transaction was pursuant to a written contract in effect on September 13, 1995, and at all times after that date until the time that the transaction occurs.

However, if a written contract is materially modified, it is treated as a new contract entered into as of the date of the material modification. A material modification includes amending the contract to extend its term or to increase the compensation payable to a disqualified person.

Disqualified person. For purposes of this Schedule I, a disqualified person means:

1. Any person (at any time during the 5-year period ending on the date of the transaction) in a position to exercise substantial influence over the affairs of the organization,

2. A family member of an individual described in 1 above, and

3. A 35% controlled entity of a person described in 1 or 2 above.

Investment advisor. Investment advisor means for any sponsoring organization, any person compensated by such organization (but not an employee of such organization) for managing the investment of, or providing investment advice

Family members. Family members of a disqualified person described in 1 above include a disqualified person's spouse, ancestors, children, grandchildren, great grandchildren, and brothers and sisters (whether by wholeor half-blood). It also includes the spouse of the children, grandchildren, great grandchildren, brothers, or sisters (whether by whole- or half-blood).

35% controlled entity. The term 35% controlled entity means:

• A corporation in which a disqualified person described in 1 or 2 above owns more than 35% of the total combined voting power,

• A partnership in which such persons own more than 35% of the profits interest, or

• A trust or estate in which such persons own more than 35% of the beneficial interest. In determining the holdings of a business enterprise, any stock or other interest owned directly or indirectly shall apply.

For donor advised funds, sponsoring organizations, and certain supporting organization transactions occur- ring after August 17, 2006. The following persons will be considered disqualified persons along with certain family members and 35% controlled entities associated with them:

• Donors of donor advised funds,

• Donor advisors of donor advised funds,

• Investment advisors of sponsoring organizations, and

• Disqualified persons of a section 509(a)(3) supporting organization for the organizations that organization supports.

For certain supporting organization transactions occurring after July 25, 2006. Substantial contributors to supporting organizations will also be considered disqualified persons along with their family members and 35% controlled entities.

Donor advised fund. See the Schedule K instructions, later, for a definition of donor advised fund.

16 Instructions for Form 4720 (2025)

for assets maintained in donor advised funds maintained by such sponsoring organization.

Sponsoring organization. See the Schedule K instructions, later, for a definition of sponsoring organization.

Substantial contributor. In general, a substantial contributor means any person who contributed or bequeathed an aggregate of more than $5,000 to the organization, if that amount is more than 2% of the total contributions and bequests received by the organization before the end of the tax year of the organization in which the contribution or bequest is received by the organization from such person. A substantial contributor includes the grantor of a trust.

Specific Instructions