Section 501(c)(2) Corporation

[Guest John Nelson]

Can someone comment on how a "Section 501©(2) corporation" (i.e., a corporation which is tax exempt under Code section 501©(2)) operates. I've recently run across a situation where the Plan apparently owns shares of a 501©(2) corporation, which in turn holds title to real property. As near as I can tell, the corporation collects rents, pay expenses, and remits the balance to the plan. The Plan is proposing to distribute the participant's interest (you guessed it, the participant is a doctor) in the form of a direct rollover to an IRA. I'm wondering should the Plan distribute the shares of the corporation to the IRA, or should the Plan dissolve the corporation, take title to the property, and distribute the property? Are there relative advantages to holding title to real property in this manner that I should consider? Any ideas?? Is there a "Section 501©(2)" expert out there?

Thanks.