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Assistance to
Year Grants Individuals FPCF
1984 $180,817 $184,526 $0
1985 145,073 550 560,257
1986 47,500 92,565 862
1987 53,500 1,500 0
1988 145,784 0 3,606
Revocation and Notice of Deficiency
On December 12, 1991, respondent issued the notice of
deficiency and, on the same date, issued the final adverse
determination letter revoking petitioner's tax-exempt status
effective for all years beginning on or after October 1, 1982.
The reasons given for the revocation were that the sale of the
hospital resulted in "inurement of your earnings to the benefit
of private shareholders or individuals, contrary to the
provisions of Code section 501(c)(3)" and
Additionally, during examination of the Forms 990 which
you filed for the taxable years ended September 30,
1985 and 1986, you did not establish that you conducted
the charitable, educational, research program which was
represented as having been the altruistic goal
motivating the sale of your hospital facility.
Payments made by you for the provision of patient
services, although substantial, were generally
restricted to patients of Anclote Manor Hospital who
were not shown to have been members of a charitable
class. Research and education programs were minimal
and poorly documented. There was no evidence that
donations made to a variety of public charities,
schools, hospitals, and foundations were subjected to
any direction or expenditure responsibility.
Based on the revocation of petitioner's tax-exempt status,
respondent determined the deficiencies in the Federal income tax.
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