Section 4945. Consult with Area Counsel when drafting a Thorne letter.

Counsel approves the issuance of all Thorne letters and helps to individually design each letter specific to the fact pattern presented.

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Department of the Treasury Internal Revenue Service Tax Exempt and Government Entities RETURN ADDRESS RETURN ADDRESS

TAXPAYER NAME TAXPAYER ADDRESS TAXPAYER ADDRESS

Date:

Taxpayer ID number:

Form:

Tax periods ended:

Person to contact:

Name: ID number: Telephone: Fax: Manager’s contact information:

Name: ID number: Telephone:

Certified Mail

Dear [INSERT TAXPAYER NAME]:

I am nearing the conclusion of the examination of the [INSERT FOUNDATION NAME]’s Form 990-PF for [INSERT FISCAL YEAR(S)]. These information returns reported that the Foundation made numerous expenditures for [INSERT REASON]. The Foundation identified these expenditures as being for [INSERT TYPE OF PURPOSE] purposes. My examination has revealed that these expenditures were in fact for purposes other than [INSERT TYPE OF PURPOSE] purposes.

I have concluded that these expenditures were “taxable expenditures” within the meaning of Section 4945(d) of the Internal Revenue Code (IRC). I have concluded that the expenditures are either described in IRC Section 4945(d)(1) (amounts paid to carry on propaganda or otherwise attempt to influence legislation) or IRC Section 4945(d)(5) (amounts paid for any purpose other than one specified in IRC Section 170(c)(2)(B)).

The purpose of this letter is to advise you that I intend to propose liabilities under IRC Section 4945(a)(1) on the Foundation, and IRC Section 4945(a)(2) on you as the foundation manager. My understanding is that you do not concur with my proposals and that the Foundation has made no correction of these taxable expenditures as defined in IRC Section 4945(b)(1) on the Foundation. In addition, and as explained in more detail below, I also intend to propose IRC Section 4945(b)(2) liabilities on you as foundation manager.

[Only use one of the next 2 paragraphs. Select the 1 ^st paragraph for short statute cases (<270 days on statute remaining). Select the 2 ^nd paragraph for cases in which sufficient time remains on the statute.] While I intend to propose the liabilities described in the preceding paragraphs, please do not construe this letter as a 30-day letter. Following the conclusion of my preparation of a report on the proposed liabilities, I will send out the report of examination. Around the same time frame, statutory notices of deficiency will be issued, giving you and the Foundation 90 days to file a petition with the appropriate court.

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While I intend to propose the liabilities described in the preceding paragraphs, please do not construe this letter as a 30-day letter. Following the conclusion of my preparation of a report on the proposed liabilities, I will send out the report of examination via a 30-day letter to you. This letter will advise you of your administrative appeal rights. Generally, you will have thirty days from the receipt of that letter to submit an administrative protest.

Please be advised that I intend to propose to define correction under the facts and circumstances of this examination to be that you reimburse the Foundation for the taxable expenditures of the Foundation. I intend to propose the following amounts of taxable expenditures in the following years:

Year Taxable Expenditure

XXXX $ABCDE.00

YYYY $FGHI.00

ZZZZ $JKLMNO.00

Total $PQRSTU.00

The liability of the Foundation under IRC Section 4945(b)(1) would be eliminated if you make the above enumerated reimbursement to the Foundation. In addition, your liability under IRC Section 4945(b)(2) would be eliminated if you agree to the correction.

Pursuant to Thorne v. Commissioner, 99 T.C. 67 (1992), I am hereby formally requesting that you make the correction as cited above. Please advise me in writing by [INSERT DATE in MM DD, YYYY format] whether you will agree or refuse to make the requested correction.

Thank you for your prompt attention to this matter.

Sincerely,

[INSERT NAME]

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(1) This example can be used when extending the statute of limitations for

assessing excise tax under Section 4940 and/or income tax against a private foundation.

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[Insert Continuation of Name, If Necessary]

(Name(s))

taxpayer(s) of [Insert Street Address, P.O. Box, or APO/FPO]

[Insert City, State, Zip Code, (and foreign country, if applicable)]

(Address)

and the Commissioner of Internal Revenue consent and agree to the following:

(1) The amount of any Federal [Excise (section 4940 and/or income)] (Kind of tax)

tax due on any return(s) made by or for the above taxpayer(s) for the period(s) ended

[Insert Tax Year(s)]

may be assessed at any time on or before [Insert Expiration Date] . If a provision (Expiration date)

of the Internal Revenue Code suspends the running of the period of limitations to assess such tax, then, when, under the Internal Revenue Code, the running of the period resumes, the extended period to assess will include the number of days remaining in the extended period immediately before the suspension began.

(2) The taxpayer(s) may file a claim for credit or refund and the Service may credit or refund the tax within 6 months after this agreement ends, except with respect to the items in paragraph (4).

(3) Paragraph (4) applies only to any taxpayer who holds an interest, either directly or indirectly, in any partnership subject to subchapter C of chapter 63 of the Internal Revenue Code, as in effect for partnership taxable years beginning before January 1, 2018.

(4) Without otherwise limiting the applicability of this agreement, this agreement also extends the period of limitations for assessing any tax (including penalties, additions to tax and interest) attributable to any partnership items (see section 6231 (a)(3)), affected items (see section 6231(a)(5)), computational adjustments (see section 6231(a)(6)), and partnership items converted to nonpartnership items (see section 6231(b)). Additionally, this agreement extends the period of limitations for assessing any tax (including penalties, additions to tax, and interest) relating to any amounts carried over from the taxable year specified in paragraph (1) to any other taxable year(s). This agreement extends the period for filing a petition for adjustment under section 6228(b) but only if a timely request for administrative adjustment is filed under section 6227. For partnership items which have converted to nonpartnership items, this agreement extends the period for filing a suit for refund or credit under section 6532, but only if a timely claim for refund is filed for such items.

(5) This Form contains the entire terms of the Consent to Extend the Time to Assess Tax. There are no representations, promises, or agreements between the parties except those found or referenced on this Form.

Your Rights as a Taxpayer

You have the right to refuse to extend the period of limitations or limit this extension to a mutually agreed-upon issue(s) or mutually agreed-upon period of time. Publication 1035, Extending the Tax Assessment Period, provides a more detailed explanation of your rights and the consequences of the choices you may make. If you have not already received a Publication 1035, the publication can be obtained, free of charge, from the IRS official who requested that you sign this consent or from the IRS' web site at www.irs.gov or by calling toll free at 1-800-TAX-FORM (1-800-829-3676). Signing this consent will not deprive you of any appeal rights to which you would otherwise be entitled.

(Space for signature is on the back of this form and signature instructions are attached)

Catalog Number 20755I www.irs.gov Form 872 (Rev. 9-2020) 124

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(1) Extensions for Sections 4941 through 4945 taxes require modification of the

Form 872. The example shown is not an official Form, but a modified Form 872. The modified Form replaces the phrase “on any returns made by or for the above taxpayer(s) for the period(s) ended with” with “from the above taxpayer(s) for the years that are fully or partially within the taxable period(s) that began”. As a general rule for extending statutes for assessment of Chapter 42 excise taxes, use the date of the first act or failure to act (or taxable event) for the start of the taxable period.

Note: The statute must be protected for an act or acts in each separate year (including continuing acts), preferably by separate consents noting the date(s) of the act and year.

(2) Consult with Area Counsel when preparing Form 872 for excise taxes,

particularly in situations where a private foundation may be liable for several different types of excise taxes arising in a particular year or years.

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[Insert Continuation of Name, If Necessary]

(Name(s))

taxpayer(s) of [Insert Street Address, P.O. Box, or APO/FPO]

[Insert City, State, Zip Code, (and foreign country, if applicable)]

(Address)

and the Commissioner of Internal Revenue consent and agree to the following:

(1) The amount of any Federal [Excise (section 4945)] (Kind of tax)

tax due from the above taxpayer(s) for the years that are fully or partially within the taxable period(s) that began

[Insert the Date(s) on which the Taxable Expenditure(s) Occurred]

may be assessed at any time on or before [Insert Expiration Date] . If a provision (Expiration date)

of the Internal Revenue Code suspends the running of the period of limitations to assess such tax, then, when, under the Internal Revenue Code, the running of the period resumes, the extended period to assess will include the number of days remaining in the extended period immediately before the suspension began.

(2) The taxpayer(s) may file a claim for credit or refund and the Service may credit or refund the tax within 6 months after this agreement ends, except with respect to the items in paragraph (4).

(3) Paragraph (4) applies only to any taxpayer who holds an interest, either directly or indirectly, in any partnership subject to subchapter C of chapter 63 of the Internal Revenue Code, as in effect for partnership taxable years beginning before January 1, 2018.

(4) Without otherwise limiting the applicability of this agreement, this agreement also extends the period of limitations for assessing any tax (including penalties, additions to tax and interest) attributable to any partnership items (see section 6231 (a)(3)), affected items (see section 6231(a)(5)), computational adjustments (see section 6231(a)(6)), and partnership items converted to nonpartnership items (see section 6231(b)). Additionally, this agreement extends the period of limitations for assessing any tax (including penalties, additions to tax, and interest) relating to any amounts carried over from the taxable year specified in paragraph (1) to any other taxable year(s). This agreement extends the period for filing a petition for adjustment under section 6228(b) but only if a timely request for administrative adjustment is filed under section 6227. For partnership items which have converted to nonpartnership items, this agreement extends the period for filing a suit for refund or credit under section 6532, but only if a timely claim for refund is filed for such items.

(5) This Form contains the entire terms of the Consent to Extend the Time to Assess Tax. There are no representations, promises, or agreements between the parties except those found or referenced on this Form.

Your Rights as a Taxpayer

You have the right to refuse to extend the period of limitations or limit this extension to a mutually agreed-upon issue(s) or mutually agreed-upon period of time. Publication 1035, Extending the Tax Assessment Period, provides a more detailed explanation of your rights and the consequences of the choices you may make. If you have not already received a Publication 1035, the publication can be obtained, free of charge, from the IRS official who requested that you sign this consent or from the IRS' web site at www.irs.gov or by calling toll free at 1-800-TAX-FORM (1-800-829-3676). Signing this consent will not deprive you of any appeal rights to which you would otherwise be entitled.

(Space for signature is on the back of this form and signature instructions are attached)

Catalog Number 20755I www.irs.gov Form 872 (Rev. 9-2020) 126

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Taxpayer Name: Examiner: TIN: Date: Tax Form: Tax Year:

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