A term of art from Internal Revenue Code Section 4944 that refers to foundation investments (i) the primary purpose of which is to accomplish one or more of the foundation's exempt purposes, (ii) in which production of income or appreciation of property is not a significant purpose, and (iii) influencing legislation or taking part in political campaigns on behalf of candidates is not a purpose. A program-related investment (PRI) can take the form of equity, debt, guarantees, linked deposits, etc., and must be charitable in nature. PRIs are counted toward part of a private foundation’s annual distribution requirement (a 5% minimum). In the event repaid, investment returns are treated as PRIs, but the corpus is added back to the qualifying distribution requirement. Because PRIs are generally expected to be repaid, they can then be recycled into new charitable investments, increasing the leverage of the foundation's distributions.
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