Exempt organizations - Uncle Fed's Tax*Board

Exempt organizations
may be requested on the basis of support received
since incorporation. §§1.508–1, 1.509(a)–3.
(Secs. 508, 509; ’86 Code.)
Rev. Rul. 77-469, 1977-2 C.B. 196.
210.65 Status; application for recognition.
An organization that is organized and operated
exclusively for charitable purposes and is not a
private foundation applied for recognition of its
exempt status six years after it was incorporated.
During its first three taxable years the organization’s
aggregate gross receipts were less than
$15,000. During the fourth year its aggregate
gross receipts for that year and the preceding two
taxable years were greater than $15,000. The organization
is not exempt under section 501(c)(3)
from the beginning of its fourth year until the date
it filed the required notice. Consideration will be
given in applying the Commissioner’s discretionary
authority under reg. 1.9100-1 to extend the
time for satisfying the notice requirement.
§§1.508-1, 1.9100-1. (Sec. 508, ’86 Code.)
Rev. Rul. 80-259, 1980-2 C.B. 192.
210.66 Status; application for recognition.
An organization that is organized and operated
exclusively for charitable purposes and is not a
private foundation filed Form 1023 more than 90
days after the end of its second taxable year. The
organization’s gross receipts for the first taxable
year were less than $7,500 but its aggregate gross
receipts for the first and second taxable years
exceeded $12,000. The organization did not satisfy
the test under regs. 1.508–1(a)(3)(ii)(b) and is
not exempt under section 501(c)(3) from the date
it was incorporated until the date it filed the
required notice. Consideration will be given to
applying the Commissioner’s discretionary
authority under regs. 1.9100-1 to extend the time
for satisfying the notice requirement. §§1.508-1,
1.9100-1. (Sec. 508, ’86 Code.)
Rev. Rul. 81-177, 1981-2 C.B. 132.
210.67 Status; application for recognition;
change in enabling instrument; 15-month notification
period. Examples illustrate the effective
date for recognition of exemption under section
501(c)(3) when an organization makes a non-substantive
amendment to its enabling instrument.
The examples involve the computation of the
15-month notification period under reg.
1.508–1(a)(2)(i). Rev. Proc. 84-46 amplified.
§§1.501(c)(3)-1, 1.508-1(a), 1.9100-1. (Sec.
601.201, S.P.R.; Secs. 501, 508, ’86 Code.)
Rev. Proc. 84-47, 1984-1 C.B. 545.
210.68 Status; application for recognition;
date of filing The date of notice for purposes of
section 508(a) is the date of the U.S. postmark
stamped on the cover in which an exemption
application is mailed or, if no postmark appears on
the cover, the date the application is stamped as
received by the Service. §§1.508–1, 301.7502-1.
(Secs. 508, 7502; ’86 Code.)
Rev. Rul. 77-114, 1977-1 C.B. 152.
210.69 Status; application for recognition;
FICA exemption. Forms SS-15 and SS-15a, filed
in 1961 by a nonprofit charitable organization to
waive its exemption from social security taxes
pursuant to section 3121(k) were valid when filed
even though the organization did not file an
application for recognition of its section 501(c)(3)
status until 1976. §1.501(a)–1. (Sec. 501, 3121;
’86 Code.)
Rev. Rul. 77-315, 1977-2 C.B. 355.
210.70 Status; application for recognition;
requirements. Application instructions and
requirements are provided for exemption from
federal income tax under section 501(c)(25) of the
Code.
Notice 87-18, 1987-1 C.B. 455.
210.71 Status; application for recognition;
untimely notice. An organization that otherwise
qualifies for exemption under both sections
501(c)(3) and 501(c)(4) filed the notice required
by section 508(a) more than 15 months after the
end of the month in which it was organized. The
organization may apply for and obtain exemption
under section 501(c)(4) from the date of its inception
to the date the exemption under section
501(c)(3) becomes effective. §§1.501(c)(3)-1,
1.501(c)(4)-1, 1.508-1. (Secs. 501, 508; ’86
Code.)
Rev. Rul. 80-108, 1980-1 C.B. 119.
210.72 Subsidiary of exempt parent. A separately
incorporated subsidiary of an exempt organization
may not consider itself exempt merely
because of its relationship to the exempt parent.
Further, the inclusion of the financial information
of the subsidiary on the information return of the
parent does not satisfy the reporting requirements
of the subsidiary. §§1.501(a)–1, 1.6033–1. (Secs.
501, 6033; ’86 Code.)
Rev. Rul. 67-174, 1967-1 C.B. 119.
210.73 Title holding corporations or trusts;
application instructions and requirements.
Notice 87–18 is modified and supplemented to
allow certain corporations to include organizational
provisions in by-laws instead of articles of
incorporation, and to provide additional requirements
with respect to holdings and activities of
section 501(c)(25) organizations.
Notice 88-121, 1988-2 C.B. 457.
210.74 Transition rules; lobbying expenses.
With respect to dues assessed or received by certain
tax-exempt organizations before 1994, that
are allocable to nondeductible lobbying and political
expenditures paid or incurred after 1993, the
organizations may provide their members with
required notices. In lieu of paying a tax on those
expenditures, an organization may adjust notices
provided for the following taxable year.
Notice 93-55, 1993-2 C.B. 339.
Instrumentalities of United States
212.1 National farm loan associations. The
Revenue Act of 1951 does not affect the exempt
status of national farm loan associations. (Sec.
101, ’39 Code; Sec. 501, ’86 Code.)
Rev. Rul. 133, 1953-2 C.B. 155.
212.2 Nonappropriated welfare fund; Armed
Forces. A nonappropriated welfare fund, established
and operated under Armed Forces Regulations,
is considered an activity of the U.S. Government
and is exempt from tax; it is not required to
file an application for exemption or to file income
tax returns. §1.501(a)–1. (Sec. 501, ’86 Code.)
Rev. Rul. 67-249, 1967-2 C.B. 179.
212.3 Railroad partially owned by R.F.C. A
reorganized railroad company which has issued all
its first mortgage bonds and the majority of its
shares of common stock to the Reconstruction
Finance Corporation in satisfaction of a debt, and
has also issued and set aside shares of its common
stock for subscription through warrants issued to
private creditors, is not exempt from tax.
§§39.22(a)-1, 39.101(14)-1. (Secs. 22(a), 101,
’39 Code; Secs. 61, 501, ’86 Code.)
Rev. Rul. 56-93, 1956-1 C.B. 601.
Private foundations
214.1 Adjusted net income; pre-1970 principal
and interest received. Repayments of principal
received by a private foundation in taxable
years beginning after 1969 on loans made in prior
years to individuals for charitable purposes are not
includable in its gross income to determine its
adjusted net income for purposes of section
4942(f). However, payments of interest on such
loans are includible. §53.4942(a)-2. (Sec. 4942,
’86 Code.)
Rev. Rul. 75-443, 1975-2 C.B. 449.
214.2 Animal clinic. An exempt organization
that maintains a free clinic for animals does not
qualify as a hospital or an organization that provides
medical or hospital care within the meaning
of section 170(b)(1)(A)(iii) and is a private
foundation. §§1.170A-9, 1.509(a)-2. (Secs. 170,
509; ’86 Code.)
Rev. Rul. 74-572, 1974-2 C.B. 82.
214.3 Appeal of certain taxes. Procedures set
forth the appeal process regarding certain taxes
imposed on exempt organizations and farmers
cooperatives and on certain individuals subject to
the excise taxes imposed under Chapter 42 of
Code relating to private foundations.
§§1.501(a)-1, 1.507-1, 1.511-1, 1.521-1,
1.641(a)-1, 1.1383-1, 53. 4941(a)-1,
53.4941(b)-1, 53.4944-1, 53.4944-2, 53.4945-1,
53.4947-1. (Sec. 601.105, S.P.R.; Secs. 501, 507,
511, 521, 527, 641, 1383, 4941, 4944, 4945, 4947,
’86 Code.)
Rev. Proc. 77-31, 1977–2 C.B. 540.
214.4 Association of churches; different
denominations. An exempt organization whose
membership is comprised of churches of different
denominations qualifies as an association of
churches within the meaning of section
170(b)(1)(A)(i) for purposes of classification as an
organization that is not a “private foundation”.
§§1.170A-9, 1.509(a)-3. (Secs. 170, 509; ’86
Code.)
Rev. Rul. 74-224, 1974–1 C.B. 61.
214.5 Blood bank; hospitals collecting fees.
Hospitals that receive blood from a nonprofit
blood bank under an agreement making each hospital
responsible for collecting payment for the
blood and remitting the payments to the blood
bank, and requiring the hospital to pay for the
blood if it fails to collect from the patient, are acting
as agents for the blood bank. These amounts
the hospital collects are treated as received by the
blood bank directly from patients in determining
if it satisfies the one-third support test under section
509(a)(2)(A)(ii) as an organization not a private
foundation. §1.509(a)–3. (Sec. 509, ’86
Code.)
Rev. Rul. 75–387, 1975–2 C.B. 216.
214.6 Charitable trusts; filing requirements.
Filing requirements for charitable and split-interest
trusts are provided. Rev. Proc. 73–29 superseded.
(Sec. 601.602, S.P.R.)
Rev. Proc. 83-32, 1983–1 C.B. 723.
214.7 Charitable trusts; nonexempt; investment
income; unrelated income. Unrelated business
income taxable under section 641(a) is not
includable in the gross investment income of a section
4947(a)(1) nonexempt charitable trust in
determining the tax on its investment income.
§53.4940-1. (Sec. 4940, ’86 Code.)
Rev. Rul. 74-497, 1974-2 C.B. 383.
214.8 Charitable trusts; nonexempt; substantial
contributor. An organization that is a
nonexempt charitable trust described in section
4947(a)(1) that has made contributions to a private
foundation in excess of the limitation in section
507(d)(2) is not a “substantial contributor” within
the meaning of that section for purposes of the tax
on self-dealing under section 4941. The exception
provided in reg. 1.507–6(a)(2) for section
501(c)(3) organizations also applies to nonexempt
charitable trusts described in section 4947(a)(1).
§1.507-6. (Sec. 507, ’86 Code.)
Rev. Rul. 73-455, 1973-2 C.B. 187.
214.9 Controlled by community trust; contribution
limitation. A trust is operated, supervised,
and controlled by the distribution committee
of a community trust. Each individual donor to
the trust has the right to designate charitable recipients
of the income and corpus of the trust attributable
to the donor’s contribution. The trust is
described in section 170(b)(1)(D) (iii), and the 50