"Advance Religion" Under the IRS ruling for determination exemption under 501(c)3 A nonprofit organization that supervises the preparation and inspection of food products prepared commercially to insure the compliance of individual members with the tenets and dictates of a particular religion was held to be accomplishing a charitable purpose by engaging in an activity that advances religion and thus the organization is exempt under IRC 501(c)(3) in Rev. Rul. 74–575, 1974–2 C.B. 161. Similarly, a nonprofit organization formed to compile genealogical research data on its family members in order to perform religious ordinances in accordance with the precepts of the religious denomination was held to be advancing religion. Rev. Rul. 71–580, 1971–2 C.B. 235. Rev. Rul. 75–282, 1975–2 C.B. 201 held that an organization, formed and controlled by an exempt conference of churches, that borrows funds from individuals and makes mortgage loans at less than the commercial rate of interest to affiliated churches to finance the construction of church buildings qualifies for exemption. By operating under the close supervision and control of the parent church conference, the organization was considered to be advancing religion by carrying out an integral part of the activities of the parent, i.e., aiding member churches in obtaining facilities for their religious purposes. Rev. Rul. 77–377, 1977–2 C.B. 192, reached a contrary result concerning a nonprofit organization that arranges and conducts winter-time ocean cruises during which activities to further religious and educational purposes are provided in additional to extensive social and recreational activities. This organization is not operated exclusively for exempt purposes under IRC 501(c)(3). Rev. Rul. 77–430, 1977–2 C.B. 194, held that an otherwise qualifying organization that conducts weekend religious retreats, open to individuals of diverse Christian denominations, at a rural lakeshore site at which the participants may enjoy the recreational facilities in their limited amount of free time and that charges no fees qualifies for exemption under IRC 501(c)(3) as an organization operated exclusively for religious purposes. This organization is clearly distinguishable from the one in Rev. Rul. 77–366 because the facts show the primary emphasis was on religious, not recreational, activities. Rev. Rul. 79–359, 1979–2 C.B. 226, held that an organization whose purpose is to provide traditional burial services that directly support and maintain basic tenets and beliefs of a religion regarding burial of its members is operated exclusively for charitable purposes and is exempt under IRC 501(c)(3). An organization that operated a medical aid plan for its church members was held to be furthering the church’s religious tenet that members should bear one another’s burdens and thus was entitled to exemption under IRC 501(c)(3). Bethel Conservative Mennonite Church v. Commissioner, 84–2 USTC 9195 (CA 7), rev’g 80 T.C. 352 (1983). Compare Living Faith v. Commissioner, 950 F.2d 365 (7th Cir. 1991), aff’g T.C.M. 1990–484, in which an organization that operated vegetarian restaurants and health food stores in a manner consistent with the religious beliefs of the Seventh-Day Adventist religion did not qualify for recognition of exemption under IRC 501(c)(3). The court concluded its operations evidenced a substantial nonexempt commercial purpose.
Posted on: Tue, 03 Sep 2013 09:02:47 +0000
Trending Topics
Recently Viewed Topics
© 2015