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During the administrative proceeding, petitioner attempted
to countermand and withdraw several of its comments, practices,
and activities after the Commissioner determined that these items
would preclude petitioner from qualifying as a section 501(c)(3)
organization. However, we review the administrative record in
its entirety.
Section 501(a) provides tax-exempt status for organizations
described in section 501(c). Section 501(c)(3) includes the
following organizations:
(c)(3) Corporations, and any community chest,
fund, or foundation, organized and operated exclusively
for religious, charitable, scientific, testing for
public safety, literary, or educational purposes, * * *
no part of the net earnings of which inures to the
benefit of any private shareholder or individual, no
substantial part of the activities of which is carrying
on propaganda, or otherwise attempting, to influence
legislation, * * * and which does not participate in,
or intervene in * * * any political campaign on behalf
of (or in opposition to) any candidate for public
office.
Contributions to organizations described in section 501(c)(3) are
generally deductible to donors. See sec. 170(a)(1).
To come within the terms of section 501(c)(3), an
organization must be both “organized” and “operated” exclusively
for tax-exempt purposes. Sec. 1.501(c)(3)-1(a)(1), Income Tax
Regs. The presence of a single substantial nonexempt purpose
precludes exempt status for the organization, regardless of the
number or importance of exempt purposes. See Better Bus. Bureau
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