KJ's Fund Raisers, Inc. - Page 8

                                                - 8 -                                                 

                  A realistic look at the operations of these two entities,                           
                  however, shows that the activities of * * * [the taxpayer]                          
                  and the Pastime Lounge were so interrelated as to be                                
                  functionally inseparable.  Separate accountings of receipts                         
                  and disbursements does not change that fact.                                        
                        * * * Since the record in this case does not show that                        
                  the * * * [taxpayer] was operated exclusively for exempt                            
                  purposes, but rather indicates that it benefited private                            
                  interests, exemption was properly denied.  [Fn. ref.                                
                  The manner in which petitioner is operated benefits private                         
            interests, KJ's Place and its owners.  Like P.L.L. Scholarship                            
            Fund v. Commissioner, supra, petitioner's lottery tickets are                             
            sold at a single location, KJ's Place.  As in P.L.L. Scholarship                          
            Fund v. Commissioner, supra, the lottery tickets are sold during                          
            KJ's Place's regular business hours, their sale overseen by the                           
            owners of KJ's Place, Hurd and Gould.  While in KJ's Place,                               
            lottery ticket purchasers are solicited for beverages.  As in                             
            P.L.L. Scholarship Fund v. Commissioner, supra, the accounts of                           
            petitioner and KJ's Place are kept separate and apart.                                    
                  Despite these similarities, petitioner contends that two                            
            factors distinguish it from P.L.L. Scholarship Fund v.                                    
            Commissioner, supra.  First, the board of directors is                                    
            responsible for running petitioner, and the majority of the board                         
            members are not related to the owners of KJ's Place.  Second,                             
            KJ's Place has allegedly lost money as patrons prefer to purchase                         
            lottery tickets rather than beverages.                                                    

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

Last modified: May 25, 2011