14 CLOSELY HELD STOCK BENEFIT FROM YOUR PHILANTHROPY People who own sizable blocks of stock in closely held corporations are strategically positioned to create unique planning benefits. When a majority shareholder would like to get retained earnings out of the corporation, use them for a philanthropic purpose without having them taxed again, and still maintain a control position in the corporation’s outstanding stock, there is a way to do so. To accomplish the objectives, the shareholder gives some of his or her stock to a favorite organization, such as Jesuit (but not so much so as to reduce ownership to 50 percent or less). Jesuit can then sell the stock back to the corporation, which uses its retained earnings to purchase the shares. (The IRS, however, says there can be no prearranged contract or agreement for the organization to sell the stock or for the corporation to buy it.) Benefits �� Eliminate capital gains taxes. �� Qualify for an income tax deduction. �� Maintain control of the corporation. Finding God in all things
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