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Unrelated Business Income
The next issue we must decide is whether the income
generated from petitioner's solicitation program for The
Constabulary is unrelated business income subject to tax pursuant
to section 511. Petitioner argues that it merely solicited
contributions and did not engage in the business of selling
advertising. Respondent contends that petitioner’s solicitation
of displays and listings in The Constabulary constituted the sale
of advertising as a trade or business.
We first examine whether petitioner sold "advertising". The
Code and the regulations do not provide a definition of the term
"advertising" or "advertisement". In Fraternal Order of Police
v. Commissioner, 87 T.C. 747 (1986), affd. 833 F.2d 717 (7th Cir.
1987), we examined whether listings similar to those in the
instant case constituted "advertising". In Fraternal Order of
Police, an organization exempt from tax pursuant to section
501(c)(8) published The Trooper magazine, which contained
articles relating primarily to the duties of police officers, and
two types of listings: (1) "large listings", which contained the
usual elements associated with advertisements, such as blocking,
illustrations, signatures, trademarks, and emblems, and (2) a
business directory, which classified and arranged the listers in
the same manner as the yellow pages of a telephone directory.
Id. at 750. The Trooper also had an "Advertisers’ Index"
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