Can a tax-exempt 501c3 corporation loan monies to an other corporation to be precise not tax-exempt?
Can a tax-exempt 501c3 corporation ONLY disburse funds for the following 2 reason :
1)To discharge legal liability of the corporation. i.e. business expenses or purchases of fixed assets.
2)To donate monies to another tax-exempt union
(ie once monies enter a 501c3, they stay beside that procedure or be in motion to another tax-exempt 501csorganization).
So is it trial for a tax-exempt 501c3 corporation to loan out monies to another corporation i.e. NOT tax-exempt?
If so, what happen if the 2nd corporation dissolves until that time paying off the loan?
Here’s what going on: The 2nd corporation is working on their tax-exempt application, but have not submitted nonetheless. Needs some pip money to acquire started. Will use the monies for CPA and file the IRS and Calif tax-exempt applications. But if the application is not approved, the 2nd corporation will dissolve. Therefore it won’t be paying the loan rear to the 501c3.
Any input or website reference would be great. thanks
Answers:
My direction would be to not loan the kernel money since here is the threat of not have the loan repaid.
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1)To discharge legal liability of the corporation. i.e. business expenses or purchases of fixed assets.
2)To donate monies to another tax-exempt union
(ie once monies enter a 501c3, they stay beside that procedure or be in motion to another tax-exempt 501csorganization).
So is it trial for a tax-exempt 501c3 corporation to loan out monies to another corporation i.e. NOT tax-exempt?
If so, what happen if the 2nd corporation dissolves until that time paying off the loan?
Here’s what going on: The 2nd corporation is working on their tax-exempt application, but have not submitted nonetheless. Needs some pip money to acquire started. Will use the monies for CPA and file the IRS and Calif tax-exempt applications. But if the application is not approved, the 2nd corporation will dissolve. Therefore it won’t be paying the loan rear to the 501c3.
Any input or website reference would be great. thanks
Answers:
My direction would be to not loan the kernel money since here is the threat of not have the loan repaid.