Variety Club Tent No. 6 Charities, Inc. - Page 19

                                        -19-                                          
               On August 6, 1985, petitioner’s board of trustees authorized           
          a payment of $2,500 to Ohio Boys Town to set up Elyria Hall for             
          bingo games and to buy equipment that Ohio Boys Town could use in           
          operating bingo games in Elyria Hall.  Pursuant to this                     
          authorization, petitioner gave a $2,500 check, dated August 6,              
          1985, to Ohio Boys Town.  The check was signed by Plants and                
          Zeve.  Ohio Boys Town determined that it would not conduct bingo            
          games at Elyria Hall.  It endorsed the check in blank, and                  
          Popovic then endorsed the check in blank.  On September 7, 1985,            
          the check was deposited by AmeriTrust Co. to an account at the              
          Cuyahoga Savings Association.                                               
               For each year in issue, petitioner filed a Form 990                    
          disclosing its income, expenses, and other organizational and               
          financial information.  Petitioner failed to disclose in its 1984           
          or 1985 Forms 990 that it was leasing property from P&R, a                  
          corporation with which a principal officer of petitioner was                
          affiliated.  Petitioner failed to disclose on its 1986 Form 990             
          that it had paid a retainer for legal services on behalf of Zeve.           
               On February 9, 1990, respondent issued to petitioner a final           
          notice of revocation of the favorable ruling letter, retroactive            
          to October 1, 1983.  The determination was based on a finding               
          that all or part of petitioner’s net earnings had inured to the             
          benefit of private shareholders or individuals.  On the same day,           
          respondent also issued to petitioner a notice of deficiency with            
          respect to its income taxes for its fiscal 1984, 1985, and 1986.            




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