The Texas Tax Lawyer
This article summarizes special tax considerations that should be taken into account when for-profit parties seek to engage in joint ventures with charitable organizations. In particular, there are two areas of concern unique to charitable organizations with respect to joint ventures with for-profit parties. First, certain rules restrict or prohibit a charitable organization's ability to enter into transactions with insiders. Second, a charitable organizations' participation in a joint venture with a taxable party may cause the charitable organization to incur unrelated business taxable income or lose its tax-exempt status. Underlying both of these areas of concern is the overriding concern that a charitable organization be organized primarily for the conduct of its charitable purposes and not engage in any activity that results in private inurement or private benefit.
3 - Spring
Terri L. Helge,
Joint Ventures of Nonprofits and For-Profits,
Available at: https://scholarship.law.tamu.edu/facscholar/722