FOR INVESTING WITH MADOFF, PRIVATE FOUNDATIONS COULD FACE TAX FINES
Submitted by giarts-ts-admin on February 23, 2009
Foundations that lost billions of dollars investing with Bernard L. Madoff have another reason to fret: they could be socked with sizable fines for failing to exercise sound judgment.
Under an obscure tax rule, private foundations can be penalized for failing to vet their investments properly, to heed red flags or to diversify prudently. While foundations are exempt from federal income taxes, they are subject to this excise tax, intended to keep them from taking outsize risks that could threaten their very survival. Read more.