KJ's Fund Raisers, Inc. - Page 4

                                                - 4 -                                                 

            directors and the owners of KJ's Place, and petitioner's books                            
            are kept separate from the accounts of KJ's Place.                                        
                  From the proceeds of the sales of the lottery tickets,                              
            petitioner has made grants to a variety of organizations.  Some                           
            of these grants have been memorialized in local newspapers.  Of                           
            six clippings sent to the IRS by petitioner, two have a photo of                          
            Hurd or Gould in front of KJ's Place handing out a check on                               
            behalf of petitioner.  One clipping notes that KJ's Fund Raisers                          
            is a new corporation located at KJ's Place.  Another shows a                              
            director of petitioner presenting a check and identifies the                              
            proceeds as arising from rip-ticket sales at KJ's Place.                                  
                  In its preliminary adverse determination letter, issued on                          
            June 7, 1994, the IRS indicated that the identity of the lounge                           
            owners and the officers of petitioner put Hurd and Gould in a                             
            position to control petitioner.  Petitioner responded as follows:                         
                        With respect to control of the organizations, it                              
                  may appear that all of KJ's Fundraisers, Inc.,                                      
                  fundraising activities can be controlled by the owners                              
                  of the lounge due to the relationship between officers                              
                  and directors of each.  It is our opinion, however,                                 
                  that KJ's Fund Raisers, Inc. would fold without the                                 
                  original founders of the organization as officers and                               
                  local charities would go unfunded.  Therefore we do not                             
                  view the appointment of the present officers as a                                   
                  function of control but more as a function of going                                 
                  The IRS issued its final adverse determination letter on                            
            February 27, 1996.  It stated:                                                            
                        You have failed to establish that you are operated                            
                  exclusively for exempt purposes under section                                       

Page:  Previous  1  2  3  4  5  6  7  8  9  10  11  Next

Last modified: May 25, 2011