WASHINGTON, DC – U.S. Senators Richard Blumenthal (D-CT) and Chris Murphy (D-CT) today announced Westport, Connecticut-based Newman’s Own Foundation will be exempted from a tax provision that would have crippled the company. Language included by the Senators in today’s budget act relieves Newman’s Own Foundation and similar organizations from potential financial ruin.
“Newman’s Own Foundation is a leader in philanthropy and business in Connecticut,” said the Senators. “The Foundation is a significant source of support for communities in our state and around the world. We worked hard to include this exemption from this catastrophic tax provision, and now the company can continue to thrive as a local and global force for good.”
A federal law preserved by December’s Republican tax bill stipulates that private foundations are prohibited from owning more than 20 percent of for-profit companies for more than five years. Because of its unique business structure, under this provision Newman’s Own would be subject to a 200 percent tax on the foundation’s assets. Blumenthal and Murphy successfully included language exempting Newman’s Own and similar organizations from the tax in the budget deal passed by the Senate early this morning. The Senators’ language amends the tax code to exempt private philanthropic foundations, like Newman’s Own Foundation, from this specific tax, as long as all profits go to charity, the foundation is independently operated, and all ownership interests were acquired under the terms of a will or trust.
In January, Blumenthal and Murphy urged Senate leadership to include a solution for Newman’s Own Foundation and similar organizations in a final budget framework. Newman’s Own Foundation has donated more than $512 million to charity, including a $1.2 million commitment made last year to hurricane recovery efforts in Houston, Puerto Rico and the U.S. Virgin Islands and to aid the response to the most recent round of wildfires in California.