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GiftLaw Pro Home   >  Chapter 4 - Specific Property Gifts  >  4.8 Partnerships and LLCs  >  4.8.3 Self-Dealing Issues  >  Basic Quiz

Basic Quiz - 4.8.3 Self-Dealing Issues

1. Charitable remainder trusts (CRTs) are subject to the self-dealing rules in a manner similar to private foundations.
           
2. If a partnership or limited liability company (LLC) with an active trade or business wishes to use the lease option, the lessee must be a non-disqualified person.
           
3. A disqualified person is anyone related to the donor such as a brother, child, niece or nephew.
           
4. A public charity is never deemed to be a disqualified person.
           
5. It is permissible for a partnership or an LLC to transfer only a few assets to a CRT and continue to own the remaining assets.
           
6. An LLC or partnership will use the lease option before transferring assets to a CRT to ensure that the self-dealing rules are not violated.
           
7. Leasing or renting an asset owned by a CRT to the child of the donor is allowable, so long as the rent paid is at least fair market value.
           
8. If a donor wishes to sell LLC assets to a disqualified person, then a CRT should not be used.
           
9. If a CRT is funded with partnership shares or LLC units, no partner or other LLC owner can purchase the shares or units from the CRT.
           
10. If LLC units or partnership shares are transferred to a CRT, the trustee can sell those units or shares to the donor's brother.