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Olympic coin program. PB&T offered to split commissions with
petitioner for orders placed by petitioner's members. Neither
PB&T nor petitioner received any money from Universal Coins under
the Olympic coin program.
I. Direct Mail & Computer Services Letter
In September 1991 (after the years in issue), Chuck Smith
(Smith), president of Direct Mail & Computer Services, sent the
following letter to petitioner:
Gentlemen:
I am in receipt of your request concerning name list
rental rates during the period of 7/88-6-89. Rental
rates for nonprofit institutions have remained static
for several years, including the period in question, at
$60.00/m names rented with a $5.00/m surcharge for
sortation to the zip code level. This is essentially a
universal price which is heavily documented throughout
the list rental industry in such publications as
Standard Rates and Data, etc.
J. Petitioner's Federal Tax Returns
Petitioner timely filed Forms 990, Return of Organization
Exempt from Income Tax, and Forms 990-T, Exempt Organization
Business Income Tax Return, for the years in issue.
On its Forms 990 for the years in issue, petitioner reported
that PB&T had paid it the following amounts of royalties:
$74,703 for 1989, $105,797 for 1990, and $114,364 for 1991.
Petitioner did not report these amounts as unrelated business
taxable income on the Forms 990-T that it filed for those years.
Petitioner reported that it had received $2,500 of advertising
income for 1989, $2,500 for 1990, and none for 1991. On its
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