- 16 - Petitioners do not claim to qualify independently as educational organizations, but contend, under the integral part doctrine, that they are entitled to share in the Consortium members’ exempt status. See Hospital Bureau of Standards & Supplies, Inc. v. United States, 141 Ct. Cl. 91, 158 F. Supp. 560 (1958). The integral part doctrine is not a codified rule, but is a judicial doctrine recognized in cases, regulations, and revenue rulings as a basis for derivative exemption under section 501(c)(3). The cases applying this doctrine have held that where an organization (1) bears a “close and intimate relationship” to the operation of one or more tax-exempt organizations, and (2) provides a "necessary and indispensable" service solely to those tax-exempt organizations, it will take on the exempt status of those organizations. See, e.g., Hospital Bureau of Standards & Supplies, Inc. v. United States, supra at 562; Council for Bibliographic & Info. Technologies v. Commissioner, T.C. Memo. 1992-364. The rationale behind the integral part doctrine is that an organization that takes over an essential task which would otherwise have to be performed by the organizations served should be exempt because the members would continue to be exempt if they performed the task themselves. Cf. Hospital Bureau of Standards & Supplies, Inc. v. United States, supra at 562-563 (concluding that an organization that took over an essential task was exempt under integral part doctrine); Nonprofits' Ins. Alliance v.Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 Next
Last modified: May 25, 2011