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visited the sites where the instant pull-tab tickets were sold
and supervised the bingo games.
From 1992 through 1995, petitioner received no public
support. For those years, petitioner reported to respondent that
its gross income was as follows:
Year Gaming Operation Interest Income
1992 $871,893 $20,199
1993 1,305,461 7,128
1994 2,085,332 11,456
1995 2,043,145 11,291
During petitioner’s audit, Clausing and petitioner’s counsel
informed petitioner’s workers that one of respondent’s agents
might question the workers on whether they were paid by
petitioner for their work in the gaming operation. Clausing and
petitioner’s counsel advised the workers on what they should and
should not say in response to the questions.
OPINION
Section 501(a) generally provides that organizations
described in section 501(c) are exempt from Federal income tax.
Section 501(c)(3) includes within that description certain
“Corporations * * * organized and operated exclusively for
religious, charitable, scientific, testing for public safety,
literary, or educational purposes”. Exemptions from tax are
exceptions to the norm, and petitioner bears a heavy burden to
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