[Code of Federal Regulations]
[Title 26, Volume 2]
[Revised as of April 1, 2003]
From the U.S. Government Printing Office via GPO Access
[CITE: 26CFR1.148-6A]

[Page 735-736]
 
                       TITLE 26--INTERNAL REVENUE
 
    CHAPTER I--INTERNAL REVENUE SERVICE, DEPARTMENT OF THE TREASURY 
                               (CONTINUED)
 
PART 1--INCOME TAXES--Table of Contents
 
Sec. 1.148-6A  General allocation and accounting rules.

    (a) through (d)(3)(iii)(B) [Reserved]. For guidance see Sec. 1.148-
6.
    (d)(3)(iii)(C) Qualified endowment funds treated as unavailable. For 
a 501(c)(3) organization, a qualified endowment fund is treated as 
unavailable. A fund is a qualified endowment fund if--
    (1) The fund is derived from gifts or bequests, or the income 
thereon, that were neither made nor reasonably expected to be used to 
pay working capital expenditures;
    (2) Pursuant to reasonable, established practices of the 
organization,

[[Page 736]]

the governing body of the 501(c)(3) organization designates and 
consistently operates the fund as a permanent endowment fund or quasi-
endowment fund restricted as to use; and
    (3) There is an independent verification (e.g., from an independent 
certified public accountant) that the fund is reasonably necessary as 
part of the organization's permanent capital.

[T. D. 8538, 59 FR 24045, May 10, 1994. Redesignated by T.D. 8718, 62 FR 
25507, May 9, 1997]