Valuation of Assets

(1) For purposes of Section 507(c), the value of the net assets of a private

foundation shall be determined at whichever time such value is higher:

a. The first day on which action is taken by the organization which culminates

in its ceasing to be a private foundation.

b. The date on which it ceases to be a private foundation. See Treas. Reg.

1.507-7(a).

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(2) For terminations under Section 507(a)(1), the date on which the private

foundation gives notification of a voluntary termination is the day referred to in Treas. Reg. 1.507-7(a)(1). See Treas. Reg. 1.507-7(b)(1).

(3) For terminations under Section 507(a)(2), the date referred to in Treas. Reg.

1.507-7(a)(1) is the date of occurrence of the willful and flagrant act (or failure to act) or the first of the series of willful repeated acts (or failures to act) giving rise to liability for tax under Chapter 42 and the imposition of tax under Section 507(a)(2). See Treas. Reg. 1.507-7(b)(2).

(4) Fair market value of the net assets shall be determined pursuant to the

provisions of Treas. Reg. 53.4942(a)-2(c)(4). See Treas. Reg. 1.507-7(c).

(5) The term "net assets" means the gross assets of a private foundation reduced

by all liabilities of the foundation, including appropriate estimated and contingent liabilities (such as liability for tax imposed under Chapter 42). See Treas. Reg. 1.507-7(d).