Part IV doesn't apply to foreign organizations.

Nonoperating private foundations may not have to figure their short-term capital gain or loss on line 3. See Nonoperating private foundations, earlier.

Reportable gains and losses. Capital gains or losses include gains or losses from the sale or other disposition of property that:

Tip: Section 1015 provides in most circumstances for a carryover basis of property acquired by gift, that is, the basis in the hands of the donor carries over to the foundation. Section 1014 generally provides for a stepped-up basis of property acquired by bequest (other than an item of income in respect of a decedent), that is, the fair market value of the property at the decedent's death.

Losses. If the disposition of investment property results in a loss, that loss may be subtracted from capital gains realized from the disposition of property during the same tax year but only to the extent of the gains. If losses are more than gains, the excess may not be subtracted from gross investment income nor may the losses be carried back or forward to other tax years.

Reporting Transactions in Part IV

Publicly traded securities. For sales of publicly traded securities through a broker, enter the description “publicly traded securities” on line 1, column (a). Leave columns (b), (c), and (d) blank. Total the gross sales price, the cost or other basis, and the

• Is used for a charitable purpose (for sales or other dispositions in tax years beginning after August 17, 2006),

• Is held for investment, or

• Is used in the production of income. Don't include the gain or loss that is included in figuring the foundation's unrelated business taxable income.

However, don't include gains or losses for any portion of property if:

• The property was used for 1 year or more in furthering the foundation's exempt purpose or function; and

• Immediately following the use, is exchanged for property of like kind that is to be used primarily in furthering the foundation's exempt purpose or function. Rules similar to the rules of section 1031 relating to exchange of property held for productive use or investment apply. See Gross investment income, earlier.

Capital gains and losses may arise from the deemed sale of section 1256 contracts (marked to market).

Basis. The basis for determining gain from the sale or other disposition of property is the larger of:

• The fair market value of the property on December 31, 1969, plus or minus all adjustments after December 31, 1969, and before the date of disposition, if the foundation held the property on that date and continuously after that date until disposition; or

• The basis of the property on the date of disposition under normal basis rules (actual basis). See sections 1011–1016.

To figure a loss, basis on the date of disposition is determined under normal basis rules.

The rules that generally apply to property dispositions reported in this part are:

• Section 1011, adjusted basis for determining gain or loss;

• Section 1012, basis of property-cost;

• Section 1014, basis of property acquired from a decedent;

• Section 1015, basis of property acquired by gifts and transfers in trust; and

• Section 1016, adjustments to basis.

22 Instructions for Form 990-PF (2025)

expense of sale on all such securities sold. Report these lump-sum figures in columns (e) through (l), as appropriate. You must maintain detailed records of each transaction in your books and records.

Publicly traded securities are securities that are listed and regularly traded on an over-the-counter market or an established exchange in which market quotations are published or otherwise readily available. Securities include:

• Common and preferred stock,

• Bonds (including governmental obligations), and

• Mutual fund shares.

Other gains and losses. For sales of anything other than publicly traded securities sold, each transaction must be listed and reported separately, completing all appropriate columns in Part IV.

26 Instructions for Form 990-PF (2025)