Peoples Prize - Page 9

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               An organization is not organized or operated exclusively for           
               one or more of the purposes specified in * * *[section                 
               501(c)(3)] unless it serves a public rather than a private             
               interest.  Thus, * * * it is necessary for an organization             
               to establish that it is not organized or operated for the              
               benefit of private interests * * *                                     
          Private interests within the meaning of this rule may include not           
          only related persons and insiders but also unrelated and                    
          disinterested private parties.  See Am. Campaign Acad. v.                   
          Commissioner, supra at 1068-1069.  If the unrelated and                     
          disinterested third party is a charitable class, bestowing of               
          benefits on that class will not be grounds for denying the                  
          exemption.  See Aid to Artisans, Inc. v. Commissioner, 71 T.C.              
          202, 208, 212-213 (1978).  However, if the disinterested third              
          party is not a charitable class, benefits bestowed on the third             
          party, if substantial and not incidental, will be sufficient to             
          cause the exemption to be denied.  See Am. Campaign Acad. v.                
          Commissioner, supra at 1068; Christian Stewardship Assistance,              
          Inc. v. Commissioner, 70 T.C. 1037 (1978).                                  
               Car and truck manufacturers, who will receive the prize, are           
          not members of a charitable class.  Cf. Aid to Artisans, Inc. v.            
          Commissioner, supra at 215.  After examining the administrative             
          record, we have no reasonable basis, other than speculation by              
          petitioner, to conclude that the poor and distressed or any other           
          charitable class would receive any benefit from the activity                
          proposed.  We conclude that the administrative record fully                 







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