Reduction of Excess Business Holding Accrual Act

[AI summary unavailable — showing source text] Reduction of Excess Business Holding Accrual Act This bill treats certain stock repurchased by a corporation from an employee stock ownership plan (ESOP) as outstanding voting stock for purposes of the federal excise tax imposed on a private foundation’s excess business holdings. Thus, a private foundation may exclude such stock in calculating present holdings in a corporation and liability for the excise tax. (Exceptions apply.) As background, a federal excise tax is imposed on a private foundation that owns more than 20% of the voting stock in a corporation, reduced by the percentage of voting stock held by all disqualified persons (excess business holdings). However, a private foundation with excess business holdings on May 26, 1969 (grandfathered private foundation) may own a greater percentage of voting stock in certain circumstances. Under the bill, stock is treated as outstanding voting stock if such stock is not readily tradable on an established securities market; repurchased from an ESOP on or after January 1, 2020; and held by the corporation as treasury stock, cancelled, or retired. However, such stock is not treated as outstanding voting stock if it is repurc…