- 14 -
Commissioner, 73 T.C. 626, 632 (1980); Roe Found.
Charitable Trust v. Commissioner, T.C. Memo. 1989-566. In
order to satisfy section 509(a)(3)(B) the organization must
be one which is: (1) Operated, supervised, or controlled
by; (2) supervised or controlled in connection with; or (3)
operated in connection with, one or more publicly supported
beneficiary organizations. See sec. 1.509(a)-4(f)(2),
Income Tax Regs. According to section 1.509(a)-4(f)(3),
Income Tax Regs., any relationship described in section
509(a)(3)(B) must ensure that
(i) The supporting organization will be respon-
sive to the needs or demands of one or more
publicly supported organizations; and
(ii) The supporting organization will con-
stitute an integral part of, or maintain a
significant involvement in, the operations of
one or more publicly supported organizations.
Petitioner argues that it satisfies the third rela-
tionship described by section 509(a)(3)(B), the "operated
in connection with" relationship, as to Keswick. See
generally sec. 1.509(a)-4(i), Income Tax Regs. Under this
relationship, it is not necessary for one organization to
control the other, or for a third party to control both,
but it is necessary for there to be a sufficient connection
between the two organizations. Because this is the least
intimate of the three types of relationship, the regulation
imposes a stringent two-part test that must be met in order
Page: Previous 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 NextLast modified: May 25, 2011