Disqualified persons are those whose proximity to the foundation trustees prevents their participating in certain foundation activities, such as receiving grants or having business relationships. Examples of disqualified persons are donors to the foundation, trustees, certain government officials, the children, parents and spouses of trustees or other disqualified persons. Representatives of corporations or partnerships in which a disqualified person has invested significantly are similarly disallowed. While disqualified persons may provide certain services to the foundation for reasonable compensation, in general the law prohibits most transactions between foundations and disqualified persons. This is the case even if the transaction benefits the foundation. See also "self dealing" and "reasonable compensation."
a member of category of individuals who are prohibited by law from participating in financial transactions with a foundation
an individual, a general partnership, a professional corporation or another entity that for any reason is or becomes ineligible to be issued shares by a professional corporation
an individual, general partnership, professional limited liability company or other entity that for any reason is or becomes ineligible under this article to be a member of a professional limited liability company
A person prohibited from acting as a Safe Harbor, because of the person's family or business relationship to the taxpayer.
A person who, because of his or her relationship with the plan (e.g., as a fiduciary, provider of services, or the plan sponsor) is prohibited from entering into certain transactions with the plan.
A broad category including contributors to a private foundation, its managers, and certain public officials. Family members of disqualified persons are also disqualified, as are corporations and partnerships in which disqualified persons hold significant interests. Financial transactions between disqualified persons and foundations are in violation of self-dealing rules, except as specified by law.
(Private Foundation) - Substantial contributors to a private foundation, foundation managers, certain public officials, family members of disqualified persons and corporations and partnerships in which disqualified persons hold significant interests. The law bars most financial transactions between disqualified persons and foundations. (See Self Dealing)
As applied to public charities, the term disqualified person includes (1) organization managers, (2) and any other person who, within the past five years, was in a position to exercise substantial influence over the affairs of the organization, (3) family members of the above, and (4) businesses they control. Paying excessive benefits to a disqualified person will result in the imposition of penalty excise taxes on that person, and, under some circumstances, on the charity's board of directors (See Intermediate Sanctions.)
