Determination Letter
202248016
Released December 2, 2022
Revocation
Charity loses exemption over uncontrolled foreign spending and private benefit
Apply this to your situation
This page covers one taxpayer's ruling from 2022, which can't be cited as precedent. Ezel answers your situation under the current Code and IRS guidance, with citations.
Not precedent. Under 26 U.S.C. § 6110(k)(3), this written determination may not be used or cited as precedent. It resolved one taxpayer's situation on its specific facts, and identifying details were redacted by the IRS before release. The official IRS release (linked on this page as a PDF) is the authoritative source.
About this page: The plain-English summary and ruling snapshot below were written by Ezel based on the official IRS release. The full text is the IRS's own document.
View official IRS release (PDF)
Plain-English summary
The IRS revoked a charity that primarily wired funds to a separately organized foreign entity and relied on a local manager to spend them. The charity had no written agreements, did not require supporting documentation, and could not show that it reviewed and approved projects or retained control over the money. Its records also did not substantiate grants to individuals, vehicle sales, loans, property transactions, or whether transferred funds ultimately served charitable purposes. The examination found that money and property benefited the foreign manager, his business, and other designated individuals, while commercial activities and private purposes became substantial. The IRS concluded that the organization failed the operational test, lacked adequate records and control, and allowed prohibited private benefit and inurement.
Ruling snapshot
- Question: Did the organization continue to qualify under section 501(c)(3) while funding foreign activities without adequate control, records, or safeguards against private benefit?
- Outcome: revocation
- Key authorities: IRC §§ 170(c)(2) and 501(c)(3); Treas. Reg. § 1.501(c)(3)-1; Rev. Ruls. 56-304, 63-252, 66-79, and 68-489
Full text (IRS public release)
Department of the Treasury Date:
Internal Revenue Service April 28, 2022
Tax Exempt and Government Entities Taxpayer ID number:
Number: 202248016 Form:
Release Date: 12/2/2022
Tax periods ended:
Person to contact:
Name:
ID number:
Telephone:
Fax:
UIL: 501.03-00
CERTIFIED MAIL - RETURN RECEIPT REQUESTED
Why we are sending you this letter
This is a final determination that you don’t qualify for exemption from federal income tax under Internal
Revenue Code (IRC) Section 501(a) as an organization described in IRC Section 501(c)(3), effective
. Your determination letter dated , is revoked.
Our adverse determination as to your exempt status was made for the following reasons: You have failed to
provide adequate documentation to establish that you are organized and operated exclusively for exempt
purposes within the meaning of IRC Section 501(c)(3) and that no part of your net earnings inures to the benefit
of private shareholders or individuals.
Organizations that are not exempt under IRC Section 501 generally are required to file federal income tax
returns and pay tax, where applicable. For further instructions, forms and information please visit www.irs.gov.
Contributions to your organization are no longer deductible under IRC Section 170.
What you must do if you disagree with this determination
If you want to contest our final determination, you have 90 days from the date this determination letter was
mailed to you to file a petition or complaint in one of the three federal courts listed below.
How to file your action for declaratory judgment
If you decide to contest this determination, you may file an action for declaratory judgment under the provisions
of IRC Section 7428 in one of the following three venues: 1) United States Tax Court, 2) the United States Court
of Federal Claims or 3) the United States District Court for the District of Columbia.
Please contact the clerk of the appropriate court for rules and the appropriate forms for filing an action for
declaratory judgment by referring to the enclosed Publication 892, How to Appeal an IRS Determination on
Tax-Exempt Status. You may write to the courts at the following addresses:
United States Tax Court U.S. Court of Federal Claims U.S. District Court for the District of Columbia
400 Second Street, NW 717 Madison Place, NW 333 Constitution Ave., N.W.
Washington, DC 20217 Washington, DC 20439 Washington, DC 20001
Processing of income tax returns and assessments of any taxes due will not be delayed if you file a petition for
declaratory judgment under IRC Section 7428.
Letter 6337 (12-2020)
Catalog Number 74808E
Information about the IRS Taxpayer Advocate Service
The IRS office whose phone number appears at the top of the notice can best address and access your tax
information and help get you answers. However, you may be eligible for free help from the Taxpayer Advocate
Service (TAS) if you can't resolve your tax problem with the IRS, or you believe an IRS procedure just isn't
working as it should. TAS is an independent organization within the IRS that helps taxpayers and protects
taxpayer rights. Contact your local Taxpayer Advocate Office at:
Or call TAS at 877-777-4778. For more information about TAS and your rights under the Taxpayer Bill of Rights,
go to taxpayeradvocate.irs.gov. Do not send your federal court pleading to the TAS address listed above. Use
the applicable federal court address provided earlier in the letter. Contacting TAS does not extend the time to
file an action for declaratory judgment.
Where you can find more information
Enclosed are Publication 1, Your Rights as a Taxpayer, and Publication 594, The IRS Collection Process, for
more comprehensive information.
Find tax forms or publications by visiting www.irs.gov/forms or calling 800-TAX-FORM (800-829-3676).
If you have questions, you can call the person shown at the top of this letter.
If you prefer to write, use the address shown at the top of this letter. Include your telephone number, the best
time to call, and a copy of this letter.
Keep the original letter for your records.
Sincerely,
Lynn A. Brinkley
Acting Director, Exempt Organizations Examinations
Enclosures:
Publication 1
Publication 594
Publication 892
Letter 6337 (12-2020)
Catalog Number 74808E
Department of the Treasury Date:
Internal Revenue Service 12/01/2021
Tax Exempt and Government Entities Taxpayer ID number:
Form:
Tax periods ended:
Person to contact:
Name:
ID number:
Telephone:
Fax:
Address:
Manager's contact information:
Name:
ID number:
CERTIFIED MAIL – Return Receipt Requested Telephone:
Response due date:
Dear :
Why you’re receiving this letter
We enclosed a copy of our audit report, Form 886-A, Explanation of Items, explaining that we propose to revoke
your tax-exempt status as an organization described in Internal Revenue Code (IRC) Section 501(c)(3).
If you agree
If you haven’t already, please sign the enclosed Form 6018, Consent to Proposed Action, and return it to the
contact person shown at the top of this letter. We'll issue a final adverse letter determining that you aren't an
organization described in IRC Section 501(c)(3) for the periods above.
If you disagree
1. Request a meeting or telephone conference with the manager shown at the top of this letter.
2. Send any information you want us to consider.
3. File a protest with the IRS Appeals Office. If you request a meeting with the manager or send additional
information as stated in 1 and 2, above, you’ll still be able to file a protest with IRS Appeals Office after
the meeting or after we consider the information.
The IRS Appeals Office is independent of the Exempt Organizations division and resolves most disputes
informally. If you file a protest, the auditing agent may ask you to sign a consent to extend the period of
limitations for assessing tax. This is to allow the IRS Appeals Office enough time to consider your case.
For your protest to be valid, it must contain certain specific information, including a statement of the
facts, applicable law, and arguments in support of your position. For specific information needed for a
valid protest, refer to Publication 892, How to Appeal an IRS Determination on Tax-Exempt Status.
Fast Track Mediation (FTM) referred to in Publication 3498, The Examination Process, generally doesn’t
apply now that we’ve issued this letter.
4. Request technical advice from the Office of Associate Chief Counsel (Tax Exempt Government Entities)
if you feel the issue hasn’t been addressed in published precedent or has been treated inconsistently by the
IRS.
Letter 3618 (Rev. 8-2019)
Catalog Number 34809F
If you’re considering requesting technical advice, contact the person shown at the top of this letter. If you
disagree with the technical advice decision, you will be able to appeal to the IRS Appeals Office, as
explained above. A decision made in a technical advice memorandum, however, generally is final and
binding on Appeals.
If we don't hear from you
If you don't respond to this proposal within 30 calendar days from the date of this letter, we’ll issue a final
adverse determination letter.
Contacting the Taxpayer Advocate Office is a taxpayer right
The Taxpayer Advocate Service (TAS) is an independent organization within the IRS that can help protect your
taxpayer rights. TAS can offer you help if your tax problem is causing a hardship, or you've tried but haven't
been able to resolve your problem with the IRS. If you qualify for TAS assistance, which is always free, TAS
will do everything possible to help you. Visit www.taxpayeradvocate.irs.gov or call 877-777-4778.
Additional information
You can get any of the forms and publications mentioned in this letter by visiting our website at
www.irs.gov/forms-pubs or by calling 800-TAX-FORM (800-829-3676).
If you have questions, you can contact the person shown at the top of this letter.
Sincerely,
Supervisory IRS Agent EO ,
Exempt Organizations Examinations
Enclosures:
Form 886-A
Form 6018
Form 4621-A
Pub 892
Pub 3498
Letter 3618 (Rev. 8-2019)
Catalog Number 34809F
Department of the Treasury - Internal Revenue Service Schedule number or
exhibit
Form 886-A Explanation of Items
Name of Taxpayer Tax Identification Number (last 4 digits) Year/Period Ended
ISSUE
Whether the organization, located in , continues to qualify for exemption under Section
501(c)(3) of the Internal Revenue Code?
Issue 1
Do you pass the operational test required of 501(c)(3) organizations? No, for the reasons
described below.
Issue 2
Do you maintain adequate records showing sufficient control and discretion to ensure that your
distributions are used exclusively for charitable, educational, and religious purposes as described
in section 501(c)(3) of the Code? No, for the reasons described below.
Issue 3
Do your net earnings inure to the benefit of insiders, precluding exemption under section 501(c)(3)
of the Code? Yes, for the reasons described below.
FACTS
. was granted tax-exempt status in under Internal Revenue
Code Section (IRC or Code) Section § 501(a) as an organization described in § 501(c)(3).
. conducted its operations out of until they submitted an
“Application by a foreign corporation for authorization to transact business in ” on
. The organization has been operating from since then. According to its
Articles of Incorporation dated , the purposes of the organization are as follows.
.
. filed Form for the year ended on . As of
, they have filed Forms for all the years that they have been exempt and
required to file a return. . does not have any other filling requirements.
Catalog Number 20810W www.irs.gov Form 886-A (Rev. 5-2017)
Page 1 of 21
Department of the Treasury - Internal Revenue Service Schedule number or
exhibit
Form 886-A Explanation of Items
Name of Taxpayer Tax Identification Number (last 4 digits) Year/Period Ended
The originally filed Form for shows the following:
Income
Contributions $
Gain from sale of asset $
Other revenue $
Total Income $
Expenses
Grants and similar amounts paid $
Other $
Total Expenses $
Net Loss $
Net Assets
Net assets or fund balances at beginning of year $( )
Net assets or fund balances at end of year $( )
We began an examination on .
We issued a first request for information (Information Document Request, or IDR) on
.
Governance
. reported officers/directors on the Secretary of State
annual report. Officer/Director names are as follows: , ,
, , and , and
are . and are . ,
is not related to any of the other officers.
Operations
. was formed to do 4 things:
1. Provide education training for .
2. To promote financial integrity and to help Non-government entities (hereinafter “NGO’s”) in
to operate in a more style and accounting law.
3. Move goods into . . would put goods into shipping containers,
ship overseas to , and then distribute these goods to people. Some of the goods
shipped were educational supplies (books & school supplies), clothing, car(s), etc.
Catalog Number 20810W www.irs.gov Form 886-A (Rev. 5-2017)
Page 2 of 21
Department of the Treasury - Internal Revenue Service Schedule number or
exhibit
Form 886-A Explanation of Items
Name of Taxpayer Tax Identification Number (last 4 digits) Year/Period Ended
4. To help teach people to start businesses so they can create jobs and provide for
themselves. There has been a consistent effort by . to help
people start businesses.
. conducted their own activities in the early years. However, because of the
diminished financial support, . focus now is on providing financial support.
. maintains an active website at . This four-
page website contains two primary pages. The homepage contains a “What We Do” section and
the information on “ ” that . is currently conducting as
one of their activities in . Website also contains a “contact” link and a “donate” button.
. (hereinafter “ ”), a domestic organization, works in conjunction with
(hereinafter “ ”). is a separately organized
foreign entity. was organized in as an and operates from the city of
. does not work with any domestic exempt organization(s).
, Treasurer stated in the initial interview, held on , that is a
“Sister organization” to , and that the two organizations are “related spiritually.”
, Board Chairman stated in the interview, held on , that
is an arm of in , and that there is “ relationship between
entities.”
manager on the ground, ( ), carries out the mission on
behalf of . supplies and workers (of his choosing) funds and
materials for services he ( ) provides to the people of .
provides the funds to via wire transfers with expectations on how to spend the
money. Once the money is received, is given control and discretion over funds and how
to spend them (purchase materials and distribute them).
, Treasurer informed us that provides a monthly report to on how
he spent the money. No supporting documentation for spent funds is sent with the report and none
is required by the Board of Directors. However, part of the accounting
submits in addition to the reports are pictures, which are forwarded to the Chairman of the Board.
stated that no written contracts or agreements exist between , ,
and .
, Treasurer informed us that compensates for the work he does
on their behalf. Compensation is $ dollars ($ /year) a month minus expenses. ’s
salary is part of the quarterly allocation which is based on expense reports submits to
Catalog Number 20810W www.irs.gov Form 886-A (Rev. 5-2017)
Page 3 of 21
Department of the Treasury - Internal Revenue Service Schedule number or
exhibit
Form 886-A Explanation of Items
Name of Taxpayer Tax Identification Number (last 4 digits) Year/Period Ended
.
does not have an official leadership or employment role within . is not listed
on the return or the annual reports as one of the officers or directors of the . However,
website contains a picture of the current officers and on the homepage of
“What We Do” section.
The return provides that no salaries, other compensation, and employee benefits were
paid out during the year. As stated before, no written formal compensation agreement exists
between and . During the exam we found no specific amounts referenced in
the general ledger or bank transactions as payments to .
Copies of all progress and expense reports, including pictures, that ( )
submitted to .( ) between through to the last report
available were requested for the exam in the information document request dated
. The response from the organization to this information document request stated that the
monthly information reports have been provided before. We noted one instance of expenses and
other money matters mentioned by in the emails (meeting minutes). Schedule O of
Form for provided that total funds expanded to operations was
$ . No other expense reports were noted in the meeting minutes or provided by the
organization.
Expenses and other money matters in the meeting minutes for related to the following:
1.
a. Registration $ a year due now. asked if can fund this expense
because he did this on his expense last year.
b. Auto insurance $ a year due now.
2. Registration balance due
a. Cost was $ ( ).
3. Government
a. explains that they can get one for $ and one for $ .
4. An unidentified individual was requesting if she can get months $ support or if the board
can help her get her for the school and home.
5. was asking if the board can look into increasing allocation for calls and internet because
Government increased taxes on both companies that force to also increase
their tariff by %.
6. Revenue Authority ) taxes on withholding increase due to the high rate, causing
take home pay to decrease at $ or $ at a time.
Catalog Number 20810W www.irs.gov Form 886-A (Rev. 5-2017)
Page 4 of 21
Department of the Treasury - Internal Revenue Service Schedule number or
exhibit
Form 886-A Explanation of Items
Name of Taxpayer Tax Identification Number (last 4 digits) Year/Period Ended
7. Trash pickup is $ per month.
8. was asking for an increase in salary. provided salary breakdown and take-home pay.
9. Registration - $ due to complete the registration process.
10. accreditation - $ .
Note: The for ( ) is a standard developed by the
) to describe the protocols for second-
generation (2G) networks used by such as and
.
Wire Transfers
provided copies of wire transfer statements that were completed through their
bank account. These wire transfer statements list the recipient of funds is an individual
named . ( ) is the President of and
the of . , Treasurer is listed as the originator of the wire transfers.
does not appear as the recipient on the wire transfer statements. Additionally, wire transfers
are sent to . Our web research indicates this address belongs to a
company called . is a registered , standard travels and
tours agency in . handles all aspect of travels and tours related
business such as booking for flight tickets, securing transit and tourist VISAS.
officers and stated in the interview held on
that the wire transfers are sent to account in . stated that
she lived in for years. In the last years that she lived there she helped with
. During that time, this wire transfer account was set up. set it up in
her name and is the primary beneficiary. is the secondary person listed on the account.
The account was set up this way so that either one ( ) can handle the transactions in
. and stated that is the one who handles the money
in . stated that she last travelled to in .
explained that location contains various kinds of business and
homes. was also address when lived in .
and further explained that might be able to change recipient’s
address for the wire transfers. However, they have been hesitant to do so and kept it the same all
these years because wiring funds to is a complicated process.
Catalog Number 20810W www.irs.gov Form 886-A (Rev. 5-2017)
Page 5 of 21
Department of the Treasury - Internal Revenue Service Schedule number or
exhibit
Form 886-A Explanation of Items
Name of Taxpayer Tax Identification Number (last 4 digits) Year/Period Ended
Wire transfers to totaled $ in . Expenses incurred in the United States totaled
$ . Total Expenses reported for were $ .
Annual Registration
During the interview with , held on , stated that
has to file an annual registration with the government. Part of that registration
included submitting an annual report to the government. However, when copies of these
annual reports were requested for review, , who is responsible for renewing these annual
registrations, informed us that when applying for these certificates, no report is submitted, only a
photocopy of the past year’s certificate. Our web research indicates that there is a type of annual
report that needs to be submitted to the government.
During the interview, conducted on , also stated that there is
a report that needs to be filed every year. stated that she believed the copies
of these reports can be located and provided for the exam. Copies of the , and
reports filed with the government were requested in the information document
request but never provided by .
provided the following certificates handed out to by the
government:
• Certificate of Re-Accreditation for and .
• Certificate of Business Registration (Non for Profit (NGO)) for , and .
However, as stated, never provided copies of reports that were submitted by
to the government to be granted these aforementioned certifications.
Property
“ Property” is the name of the compound from which operates.
The following information has been gathered about the property:
Property is in , in the city of .
It is a acre walled off property.
owns and operates from the property.
company operates from the property.
, an in , is another organization that uses this property. in
villages ( ). extended an invitation to to use this property
after they got evicted from another property they used by the government. The
government claimed the other property for themselves.
In the response to the information document request, dated , explained
that they provided the funds to acquire the property but the property has never been titled to
. stated that the property has always belonged to the because the
Catalog Number 20810W www.irs.gov Form 886-A (Rev. 5-2017)
Page 6 of 21
Department of the Treasury - Internal Revenue Service Schedule number or
exhibit
Form 886-A Explanation of Items
Name of Taxpayer Tax Identification Number (last 4 digits) Year/Period Ended
legal code does not allow of . states that since
they do not own the property, they do not have continuing financial interest in the said property.
In the initial interview , Treasurer stated that board and make
decisions on how the property is used. helps maintain the property on behalf of
by sending money to to keep the property going. stated that
there are guest houses on the property. One is occupied by and the other is occupied
by . also has a business located on the property; “ ” which is
discussed later in this report.
Meeting minutes discuss property and whether the officers/board should allow to
build a personal residence on the property. asked the officers/board to be allowed to build on
the property. Meeting minutes list one of the benefits of having living onsite would be an
increase in the oversight of the property. During the interview with , stated
will allow to build a personal residence for himself on the property.
planned to pay for the building himself.
Review of emails exchanged between officers/directors (meeting minutes) identified that was
asking for an increase in his salary. officers/directors discussed the rental potential of
the property and giving a percentage of rentals as a bonus to his salary. In the initial
interview with conducted on , stated that there are no
rental agreements or any other legally binding agreements between his organization and any other
entity/individual that currently has right to use this property.
Subsequent web research and interview with and discovered that
rents the guest houses on the property. Our web research shows listings of
guest room and are advertised on , , and websites. Rooms are
listed as “ ” type accommodation and the listings indicate that anyone can rent
these rooms.
and stated in the interview, conducted on , that rooms
are rented to various visitors to who provide important social service and aid to
programs and people. The rental program started in , and the monthly information reports
prepared by in reflect the rental income has received during the
month.
In the response to the information document request, dated , states
that none of the rental income accrues to or is transferred to the . Rental income provides
for operating and maintenance cost of the Compound in . There are no lease, rental, or
service agreements. Rooms are rented on a daily cash basis in . There are no codified
restrictions for rental of rooms.
Additionally, there are no specific reports regarding progress and expense relative to the rental
activity. reports gross income from rentals on the monthly information reports.
Catalog Number 20810W www.irs.gov Form 886-A (Rev. 5-2017)
Page 7 of 21
Department of the Treasury - Internal Revenue Service Schedule number or
exhibit
Form 886-A Explanation of Items
Name of Taxpayer Tax Identification Number (last 4 digits) Year/Period Ended
does not functionalize reporting for the rental rooms; thus, all expensed of the various
activities are provided on an object account basis.
Information document request provided the rental income reported by as follows:
a) $
b) $
c) $
d) $
e) $
f) $
g) $
h) $
i) $
Total $
Project
website describes this project as a four-step project. The website provides the
following information:
• STEP 1
o
.
• STEP 2
o
.
• STEP 3
o
.
• STEP 4
o
.
Email discussions (meeting minutes) provide the following information on the project:
• Establish a baseline with reported cases of for children and young adults.
Catalog Number 20810W www.irs.gov Form 886-A (Rev. 5-2017)
Page 8 of 21
Department of the Treasury - Internal Revenue Service Schedule number or
exhibit
Form 886-A Explanation of Items
Name of Taxpayer Tax Identification Number (last 4 digits) Year/Period Ended
• Provide a bio-based insect repellent for two orphanages in during the duration of the
peak season ( through ) for .
• Ensure that daily applications and proper use of the product is being maintained.
• Track the product applications and monitor the health of each of the participants.
• Document the results of the project and identify any improvements needed.
• Establish next steps and future projects in .
o The short-term goal is to validate the effectiveness of the product during the
season. The product is not intended as a replacement to current methods of
prevention. , , , and are all key components to an
effective strategy in combating and should be maintained if they are already
in use. The is considered to be yet another layer in the defense
strategy.
o The long-term goal is to create microbusinesses to provide employment for the
people through local packaging and distribution of the product. The
long-term goal would be to setup portable local manufacturing in . The
result of local manufacturing would be the ability to manufacture in and
produce the product at a cost-effective rate. The expectation is local manufacturing
would result in an increase in employment, facilitate commerce and help improve the
health of the people through use of the product.
is engaged in a business endeavor via a company he created called “ ”.
is a foreign organization incorporated by and operated from the
property in . is working on manufacturing and selling a brand of a
using raw materials, manufactured in the United States, by a for-profit company
called
.
officers/directors referred to the “ ” and “ ” as the
same activity.
is a for-profit corporation, originally formed in . It merged with a corporation of the same
name in . It is currently operating out of as a foreign corporation. website states
that they “
.” stated that is currently unable to manufacture their
repellant in U.S. due to struggles with EPA regulations. Our web research indicates that is
struggling with EPA regulations. Meeting minutes show that officers/directors conducted
meetings with founder to discuss history and its connection to
Catalog Number 20810W www.irs.gov Form 886-A (Rev. 5-2017)
Page 9 of 21
Department of the Treasury - Internal Revenue Service Schedule number or
exhibit
Form 886-A Explanation of Items
Name of Taxpayer Tax Identification Number (last 4 digits) Year/Period Ended
. Meeting minutes also show that board and officers discussed marketing and
selling a brand of called . Our web research indicated that has
manufactured a product under the label.
loaned the funds to to get the business started. We noted
transaction number in the general ledger that was recorded on .
Transaction is described as “Registration of corporation”. This transaction debited “ :
Start up Costs” account for $ and credited “ : ” account
for $ . Wire transfer to then occurred on , for $ .
In the response to the information document request, dated , states
that transaction was the recording of the wire transfer on of $ sent to
, included was $ to pay the registration of the ,"
". stated that there is no source document (an invoice, receipt, etc.) for this
transaction. Funds were sent to the bank which were used by to pay the
registration fees. was recipient of the funds. There are no organizing documents
for the Corporation held in the US corporation.
and both stated that business is almost
operational. stated that and officers/board have weekly
contacts/conversations about and work on budgeting/planning together. Review of
minutes dated ; identified a conversation regarding the units of
inventory that needs to be sold. Sale and movement of this inventory appears to be connected to
. Product's price point was discussed as well. Minutes discuss the need to be successful with the
initial vendor and prove the profitably of the business before adding support resources to
.
stated that plans to partner with to facilitate the distribution of this
raw material to through . will order the product from in
and assemble the product on site ( property) as individual . Business
expenses, associated with this activity, are paid for by . We noted that
purchased a finished product from in the form of . provided
a copy of the invoice from dated for $ .
, Board Chairman stated that put a rule in place that if you are going to
produce and sell a product in you have to be registered as a Non-Government Entity in
. can give away the product for free as much as they want but cannot produce it
themselves, they have to go through . cost about cents to produce and
hopes to sell them for cents. Product is created as one day application.
, Board Chairman stated that and hope to generate enough
sales to be able to give the product away for free.
Catalog Number 20810W www.irs.gov Form 886-A (Rev. 5-2017)
Page 10 of 21
Department of the Treasury - Internal Revenue Service Schedule number or
exhibit
Form 886-A Explanation of Items
Name of Taxpayer Tax Identification Number (last 4 digits) Year/Period Ended
Cloth Program and Fabric Cloth Sales
, Board Chairman stated this was a program in which individuals buy clothes and
resell them. helped some of these individuals establish their businesses, however,
no longer engages in this activity.
stated in the interview that he and are acquainted with an
individual by the name of brought a piece of over from to United
States. and liked the , so they bought it from .
Check was made to who in turn remitted the funds to .
We noted that expense was recorded in general ledger on for $ and
noted account name associated with this expense to be . Check number was but
organization did not provide check image nor an invoice receipt for this transaction.
primary checking account ending in shows a withdrawal occurred on
for $ . Additionally, we noted that
accepted two donations in the amount of $ dollars and then recorded these donations in the
general ledger as restricted donations for . One donation was from
and the other from another individual.
owned a building whose physical location was
. provided a copy of the settlement statement for this purchase.
Settlement date for the purchase is . purchased the property for
$ from . No physical address has been recorded for
the settlement statement but our web research pulls up a church with that name and the
address of . Funds for purchase were loaned by
of the officers, for $ and for $ .
A specific repayment schedule was not included. stated that the
Board approved the purchase at the time. There was no written agreement. There was a verbal
agreement to get the principal repaid to the officers at no interest charged.
stated that bought that property to have their own location from which
to operate and to store goods destined for . However, the property ended up not being used
because luckily was able to ship the goods/merchandise via the help of another board
member. That board member ( ) had access to dock and shipping containers which
were used to ship supplies to . had this access via his company, a
business called “ .” The organization stopped shipping to in
Catalog Number 20810W www.irs.gov Form 886-A (Rev. 5-2017)
Page 11 of 21
Department of the Treasury - Internal Revenue Service Schedule number or
exhibit
Form 886-A Explanation of Items
Name of Taxpayer Tax Identification Number (last 4 digits) Year/Period Ended
due to changes in policies that made shipping items in a container to too cumbersome and
expensive for .
gave permission to a to use the property during the duration of the time that the
property was owned by . The was allowed to stay there at no cost as long as they
paid utility and maintenance expenses. That ( ) later merged with
another ( ) and they no longer needed to use the property so the property was
sold as it had no use to .
The property was sold on . The buyer of the property is an organization named
as “ .” Translated in English, it means “
.” , Chairman of the Board, was empowered and authorized
to sign the transfer of the property on behalf of the .
Web Research and the Secretary of State research shows that
is a non-profit organization and is currently operating from this property.
It also appears this organization is a . Web research shows this organization’s tax-exempt
status is currently revoked as of . The organization initially received their
determination letter on as a 501(c)(3) organization.
Vehicles
, Board Chairman stated that in the early years, purchased
vehicles with a 4-wheel drive and the plan was to ship them to to help with transportation of
goods. does not have many highways or paved roads and the roads there need a vehicle
that can handle the road conditions during rainy seasons. used an independent shipper
who managed to ship one vehicle to . The independent shipper however was not
comfortable shipping the rest of the vehicles to because they were vehicles. When
was unable to ship the rest of the vehicles, they tried selling them.
states that the vehicles were parked in storage. Gradually they were sold, stolen, or
simply “salvaged” for parts. The $ of sale of assets was a sale of of the remaining vehicles.
The invoices for the sold vehicles were requested for the exam but were never provided.
Scholarships & Grants
sponsors an individual in called (whose name appears frequently
on the list of financial transactions), and at least one more individual .
, Treasurer explained that is a student attending of . In the
response to the information document request, dated , provided that
is a native college student, whose education costs were provided by one
of donors. For the calendar year , provided $ directly to
. Allocations were provided periodically and used to fund various school expenses.
Catalog Number 20810W www.irs.gov Form 886-A (Rev. 5-2017)
Page 12 of 21
Department of the Treasury - Internal Revenue Service Schedule number or
exhibit
Form 886-A Explanation of Items
Name of Taxpayer Tax Identification Number (last 4 digits) Year/Period Ended
In the initial interview with , Treasurer, stated that issues
grants and purchases materials by using funds sent to him by donors.
stated that does not have any grant-making procedures implemented.
does not have any written contracts or agreements between themselves, donors and/or
recipients with respect to grant-making procedures.
LAW
IRC § 501(c)(3) exempts from federal income tax organizations which are organized and
operated exclusively for religious, charitable, scientific, testing for public safety, literary, or
educational purposes, or to foster national or international amateur sports competition (but only
if no part of its activities involve the provision of athletic facilities or equipment), or for the
prevention of cruelty to children or animals, no part of the net earnings of which insures 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 (except as otherwise
provided in subsection (h)), and which does not participate in, or intervene in (including the
publishing or distributing of statements), any political campaign on behalf of (or in opposition to)
any candidate for public office.
Tax Reg. § 1.501(c)(3)-1(a)(1) of the regulations provides that in order to be exempt as an
organization described in section 501(c)(3) of the Code, the organization must be one that is
both organized and operated exclusively for one or more of the purposes specified in that
section.
Tax Reg. § 1.501(c)(3)-1(c)(1) of the regulations provides that an organization will be regarded
as “operated exclusively” for one or more exempt purposes only if it engages primarily in
activities which accomplish one or more of such exempt purposes specified in section 501(c)(3).
Tax Reg. § 1.501(c)(3)-1(c)(2) of regulations explains the prohibition against private inurement
as follows: Distribution of earnings. An organization is not operated exclusively for one or more
exempt purposes if its net earnings inure in whole or in part to the benefit of private individuals.
Tax Reg. § 1.501(c)(3)-1(d)(1)(i) of the regulations states that an organization may be exempt
as an organization described in 501(c)(3) if it is organized and operated exclusively for one or
more of the following purposes: religious, charitable, scientific, testing for public safety, literary,
educational, or prevention of cruelty to children or animals.
Tax Reg. § 1.501(c)(3)-1(d)(1)(ii) of the regulations states that an organization is not organized
or operated exclusively for exempt purposes unless it serves a public rather than a private
interest. The organization must demonstrate that it is not organized or operated to benefit
private interests such as "designated individuals, the creator or his family, shareholders of the
Catalog Number 20810W www.irs.gov Form 886-A (Rev. 5-2017)
Page 13 of 21
Department of the Treasury - Internal Revenue Service Schedule number or
exhibit
Form 886-A Explanation of Items
Name of Taxpayer Tax Identification Number (last 4 digits) Year/Period Ended
organization, or persons controlled, directly or indirectly, by such private interests." Thus, if an
organization is operated to benefit private interests rather than for public purposes or is
operated so that there is prohibited inurement of earnings to the benefit of private shareholders
or individuals, it may not retain its exempt status.
Rev. Rul. 56-304, 1956-2 C.B. 306 states that an organization which otherwise meets the
requirements for exemption from federal income tax is not precluded from making distributions of
their funds to individuals, provided such distributions are made on a true charitable basis in
furtherance of the purposes for which they are organized. However, organizations of this
character which make such distributions should maintain adequate records and case histories to
show the name and address of each recipient of aid; the amount distributed to each; the purpose
for which the aid was given; the manner in which the recipient was selected and the relationship, if
any, between the recipient and (1) members, officers, or trustees of the organization, (2) a
grantor or substantial contributor to the organization or a member of the family of either, and (3) a
corporation controlled by a grantor or substantial contributor, in order that any or all distributions
made to individuals can be substantiated upon request by the Internal Revenue Service.
Revenue Ruling 63-252, 1963-2 C.B. 101, held that contributions to a charity organized in the
United States that transfers some or all of its funds to a foreign charitable organization are
deductible only if the contribution was to or for the use of the domestic organization, and that the
domestic organization was not serving as an agent for, or conduit of, a foreign charitable
organization. In order to satisfy the requirements of § 170(c)(2)(A), a qualifying organization may
not be a mere conduit to a foreign charitable organization. The revenue ruling states that the
requirements of § 170(c)(2)(A) would be nullified if contributions inevitably committed to go to a
foreign organization were deductible solely because, in the course of transmittal to the foreign
organization, they came to rest momentarily in a qualifying domestic organization.
Rev. Rul. 64-274,1964-2 C.B. 141, (1964), describes a corporation which is organized and
operated on a nonprofit basis. It provides worthy and needy students with free housing facilities
and with funds for the purchase of books and instructional supplies or equipment on a gift, or loan
basis, without interest. Accordingly, it is held that the corporation is exempt from Federal income
tax under section 501(a) of the Code as an organization described in section 501(c)(3) of the
Code, since it has been shown that it is organized and operated exclusively for charitable
purposes.
Rev. Rul. 66-79, 1966-1 C.B. 48, amplifies Rev. Rul. 63-252 to provide that contributions to a
domestic charity described in section 170(c)(2) of the Internal Revenue Code of 1954 which are
solicited for a specific project of a foreign charitable organization are deductible under section 170
of the Code where the domestic charity has reviewed and approved the project as being in
furtherance of its own exempt purposes and has control and discretion as to the use of the
contributions.
Catalog Number 20810W www.irs.gov Form 886-A (Rev. 5-2017)
Page 14 of 21
Department of the Treasury - Internal Revenue Service Schedule number or
exhibit
Form 886-A Explanation of Items
Name of Taxpayer Tax Identification Number (last 4 digits) Year/Period Ended
Rev. Rul. 67-367, 1967-2 C.B. 188 provides that a nonprofit organization whose sole activity is the
operation of a 'scholarship' plan for making payments to pre-selected, specifically named
individuals does not qualify for exemption from Federal income tax under section 501(c)(3) of the
Internal Revenue Code of 1954.
Rev. Rul. 68-489, 1968-2 C.B. 210 describes an organization exempt from federal income tax
under section 50l(c)(3) of the Code that distributes part of its funds to organizations not themselves
exempt under that provision. The exempt organization ensured use of the funds for section
501(c)(3) purposes by limiting distributions to specific projects that are in furtherance of
its own exempt purposes. It retains control and discretion as to the use of the funds and maintains
records establishing that the funds were used for section 50l(c)(3) purposes. Held, the distributions
did not jeopardize the organization's exemption under section 501(c)(3) of the Code.
In Better Business Bureau of Washington, D.C., Inc. v. United States, 326 U.S. 279 (1945), the
Supreme Court held that the presence of private benefit, if substantial in nature, will destroy an
organization's tax-exempt status regardless of the organization's other charitable purposes or
activities.
In Church in Boston v. Commissioner, 71 T.C. 102 (1978), the court found that the organization's
officers received amounts of money in the form of "grants." These grants carried with them no legal
obligation to repay any interest or principal. Petitioner contended, as it had during the
administrative proceeding before the Service, that the grants were made in furtherance of a
charitable purpose: to assist the poor who were in need of food, clothing, shelter, and medical
attention. However, petitioner was unable to furnish any documented criteria which would
demonstrate the selection process of a deserving recipient, the reason for specific amounts given,
or the purpose of the grant. The only documentation contained in the administrative record was a
list of grants made during one of the three years in question which included the name of the
recipient, the amount of the grant, and the "reason" for the grant which was specified as either
unemployment, moving expenses, school scholarship, or medical expense. This information was
insufficient in determining whether the grants were made in an objective and nondiscriminatory
manner and whether the distribution of such grants was made in furtherance of an exempt
purpose. The failure to develop criteria for "grant" disbursements or to keep adequate records of
each recipient can result in abuse. Accordingly, it was found that the organization failed to
establish that their disbursements constituted an activity in furtherance of an exempt purpose
under section 50l(c)(3) of the Code.
In Retired Teachers Legal Defense Fund v. Commissioner. 78 T.C. 280, 286 (1982), the Court
stated that the private benefit prohibition of section 501(c)(3) of the Code applies to all kinds of
persons and groups, not just those “insiders” subject to the stricter inurement proscription.
Prohibited private benefit may include an “advantage; profit; fruit; privilege; gain or interest.”
Catalog Number 20810W www.irs.gov Form 886-A (Rev. 5-2017)
Page 15 of 21
Department of the Treasury - Internal Revenue Service Schedule number or
exhibit
Form 886-A Explanation of Items
Name of Taxpayer Tax Identification Number (last 4 digits) Year/Period Ended
In Airlie Foundation v. Commissioner, 283 F. Supp. 2d 58 (D.D.C., 2003), the court relied on the
“commerciality” doctrine in applying the operational test. Because of the commercial manner in
which this organization conducted its activities, the court found that it was operated for a non-
exempt commercial purpose, rather than for a tax-exempt purpose.
GOVERNMENT'S POSITION
Impact on IRC § 501(c)(3) tax-exempt status
Issue 1
Section 1.501(c)(3)-1(a)(1) of the regulations states that if an organization fails to meet either the
organizational test or the operational test, it is not exempt. Although your Articles of Incorporation
contain adequate provisions to meet the organizational test, you do not meet the operational test
as explained below.
Tax Reg. § 1.501(c)(3)-1(c)(1) provides that to be exempt under section 501(c)(3), an organization
must be both organized and “operated exclusively” for one or more exempt purposes specified in
the section. Tax Reg. § 1.501(c)(3)-1(d)(1)(i) lists these exempt purposes. You have not shown
that you are organized and operated exclusively for exempt purposes and not for the private
benefit of your creators, designated individuals or organizations controlled by such private
interests. The presence of a single nonexempt purpose, if substantial, will preclude exemption
regardless of the number or importance of exempt purposes. See Better Business Bureau ruling.
You stated that your main activity and focus is providing financial support in . Your support
is provided via wire transfers to a separately organized entity in called
. Our research did not return any additional information about an organization called
“ .” We took into consideration the information that was provided during
the exam, but we were unable to confirm that this organization conducts charitable activities.
An organization will be regarded as "operated exclusively" for one or more exempt purposes only if
it engages primarily in activities that accomplish one or more purposes specified in section
501(c)(3). You did not provide evidence (written agreements or annual reports) that you review and
approve the projects, conducted by ( ), ahead of time as being in furtherance
of your own exempt purposes. You did not provide evidence (written agreements or annual
reports) that ( ) engage primarily in activities that accomplish one or more
purposes specified in section 501(c)(3).
Catalog Number 20810W www.irs.gov Form 886-A (Rev. 5-2017)
Page 16 of 21
Department of the Treasury - Internal Revenue Service Schedule number or
exhibit
Form 886-A Explanation of Items
Name of Taxpayer Tax Identification Number (last 4 digits) Year/Period Ended
Your operations, with respect to and company , show factors
indicative of prohibited inurement and private benefit. Section 1.501(c)(3)-1(d)(1)(ii) of the
regulations states that an organization is not organized or operated exclusively for exempt
purposes unless it serves a public rather than a private interest. The lending of funds to
business to help start and bolster the business is a commercial, non-
exempt purpose and serves private interests. Conduct of business is not a charitable activity.
Partnering with for-profit business to help package and distribute the product is not an
inherently exempt activity but is a business that is ordinarily carried on by commercial ventures
organized for profit. Using your organization as a conduit to conduct personal transactions with
individuals such as is a non-exempt activity and it serves private interests.
Lack of any written contracts or agreements between and is concerning.
is in a position to personally benefit from your organization’s support of his company
. This activity is adversely affecting your organization’s IRC § 501(c)(3) tax-exempt
status and is grounds for a revocation.
You are unlike an organization that was described in Rev. Rul. 68-489, in that you distribute part of
your funds to organizations not themselves exempt under section 501(c)(3). You do not show
evidence that you ensure use of the funds for section 501(c)(3) purposes by limiting distributions to
specific projects that are in furtherance of your own exempt purposes. Without adequate
documentation (written agreements, annual or financial reports), we cannot substantiate that your
financial support of furthers exempt purposes as specified in section 501(c)(3).
You are similar to the organization described in Better Business Bureau of Washington, D.C., Inc.
v. United States. Although you may have some charitable and educational purposes, the presence
of the non-exempt commercial and private purposes of aligning with a for profit company
and focusing your efforts on business precludes exemption under IRC Section
501(c)(3). You did not provide any supporting documents or reports that would substantiate that
activities are in furtherance of such exempt purposes specified in IRC Section
501(c)(3).
You are similar to an organization described in Airlie Foundation v. Commissioner, 283 F. Supp. 2d
58 (D.D.C., 2003). We took into consideration your statement that and hope to
provide employment to the people and generate enough sales to be able to give the
product away for free. The information derived from meeting minutes shows discussions about
price points, profitability, and growing the business. Because of the commercial manner in which
appears to conduct its activities, we found that they are operated for a non-
exempt commercial purpose, rather than for a tax-exempt purpose. Without adequate supporting
documentation (written agreements, financial reports), we cannot substantiate that your financial
support of furthers your exempt purposes as specified in section 501(c)(3).
Catalog Number 20810W www.irs.gov Form 886-A (Rev. 5-2017)
Page 17 of 21
Department of the Treasury - Internal Revenue Service Schedule number or
exhibit
Form 886-A Explanation of Items
Name of Taxpayer Tax Identification Number (last 4 digits) Year/Period Ended
Unlike the organizations discussed in Rev. Rul. 56-304, which made distributions on a truly
charitable basis, you have not established that your distributions will be for charitable or
educational purposes. An organization is not exempt merely because its operations are not
conducted for the purpose of producing a profit. To satisfy the ‘operational test’ the organization's
resources must be devoted to purposes that qualify as exclusively charitable within the meaning of
section 501(c)(3) of the Code and the applicable regulations.
Therefore, based on our analysis, you do not satisfy the operational requirements of the Code and
Regulations to be recognized as exempt under section 501(c)(3) of the Code.
Issue 2
You are similar to the organization described in Example 1 of Rev. Rul. 63-252. You have little or
no control over who receives the cash in the foreign country of , or how much they receive.
Like Example 1 in Rev. Rul. 63-252, you simply send the funds to ( ), who
distributes it as they wish.
You are like the organization in Church in Boston v. Commissioner, which described an
organization that made distributions and failed to maintain adequate records. The court held that
the grants the organization made were not in furtherance of an exempt purpose because the
organization was unable to furnish adequate documentation in support of the funds given. You do
not have any written procedures for issuing grants to individuals such as .
Therefore, you do not have an independent grant selection committee consisting of members who
are not in a position to derive private benefit. You have been unable to furnish any documented
criteria which would demonstrate the selection process of a deserving recipient, the reason for
specific amounts given, or the purpose of the grant. The potential recipient's classification as a
member of such a class is dependent solely on the assertion of the member that a loan is needed.
Like the organization discussed in Rev. Rul. 64-274, objective criteria must be used to establish
merit or need for the services of a charitable organization.
You do not maintain adequate records required for exemption as found in Rev. Rul. 56-304. This
ruling provides records and case histories should be maintained to show the name and address of
each recipient of aid; the amount distributed to each; the purpose for which the aid was given; the
manner in which the recipient was selected and the relationship, if any, between the recipient and
organization insiders.
As required by Revenue Ruling 56-304, you do not keep adequate records to substantiate that the
grants and contributions you make further a 501(c)(3) purpose. The evidence shows you have sent
funds via wire transfers to in foreign country of . You stated that
provided directly to allocations periodically to fund various school expenses.
However, you do not track the distributed cash to individuals. You have no records to show who
actually received the final distributions or what the funds were used for. Therefore, it is clear that
you do not keep adequate records as required by Rev. Rul. 56-304. Another example of your
Catalog Number 20810W www.irs.gov Form 886-A (Rev. 5-2017)
Page 18 of 21
Department of the Treasury - Internal Revenue Service Schedule number or
exhibit
Form 886-A Explanation of Items
Name of Taxpayer Tax Identification Number (last 4 digits) Year/Period Ended
organization’s inadequate record keeping concerns the sales of vehicles. The invoices for
the sold vehicles were never provided for exam. Therefore, we cannot substantiate that the sales
of these vehicles did not benefit private individuals/entities. Additionally, you do not have written
agreements concerning loans from your officers that were used to purchase the building in
. Considering the substantial amount of money that was loaned to you, some
proper written agreements between your officers and your organization should have been enacted.
Another item of concern is the wire transfer statements that list the recipient of funds in as
. is the President of and the of
who is listed as the originator of the wire transfers. These are questionable payments and
transactions because there is no substantive supporting evidence provided to establish that all the
funds were received by in .
Although Rev. Rul. 56-304 describes requirements for distributions of funds to individuals these
requirements are nonetheless applicable to distributions made to organizations to show any
distributions are made on a true charitable basis. Aside from bank statements and a general
ledger, you have provided very little documentation supporting financial transactions, including
loans, donations, or personal expenses. Your Form for provided that total funds
expanded to operations was $ . These payments and transactions total % of all
disbursements for which no substantiation was provided to establish whether the funds were used
for 501(c)(3) purposes.
We have determined that the records and financial materials you have provided show that you do
not maintain sufficient records and controls to detail your activities and financial transactions and,
therefore, are unable to show that you exclusively further 501(c)(3) exempt activities.
Issue 3
Per section 1.501(c)(3)-1(c)(2) of the regulations, an organization is not operated exclusively for
one or more exempt purposes if its net earnings inure in whole or in part to the benefit of private
individuals. Where an activity provides a direct benefit to private insiders, it does not matter that the
benefit may be quantitatively insubstantial. Even a small amount of inurement is fatal to exemption.
You are similar to the organization described in Revenue Ruling 63-252, 1963-2 C.B. 101.
You stated that is a college student, whose education costs were
provided by one of your donors. You stated that you do not have grant making procedures in
place. Therefore, you do not have an independent grant selection committee consisting of
members who are not in a position to derive private benefit. You stated that makes
decisions with respect to grant recipients. Based on available facts and circumstances; your grants
to pre-designated individuals such as , and lack of discretion and control over use
of funds, in general, will adversely affect your IRC § 501(c)(3) tax-exempt status. Restricting funds
to send to designated individuals in the form of grants violates "conduit" and "earmarking"
restrictions. If the program awards are not based on need or merit with a pool of candidates, it is
Catalog Number 20810W www.irs.gov Form 886-A (Rev. 5-2017)
Page 19 of 21
Department of the Treasury - Internal Revenue Service Schedule number or
exhibit
Form 886-A Explanation of Items
Name of Taxpayer Tax Identification Number (last 4 digits) Year/Period Ended
not sufficient to avoid private benefit. If the payments are made to pre-selected, specifically named
individuals, exemption is precluded. See Rev. Rul. 67-367, 1967-2 C.B. 188.
As stated in the cited case Retired Teachers Legal Defense Fund v. Commissioner, the private
benefit prohibition of section 501(c)(3) of the Code applies to all kinds of persons and groups, not
just those “insiders” subject to the stricter inurement proscription. Prohibited private benefit may
include an “advantage; profit; fruit; privilege; gain or interest.” In this way, you are providing the
substantial private benefit of profit, privilege, and gain to individuals such as ,
, and .
In contradiction to Revenue Ruling 66-79, the funds you raise are not used for the purposes of the
domestic organization (you), but rather for the purposes of the foreign organizations ( &
) receiving the grant from the domestic organization (you). By your own admission,
your activities consist of providing financial support to and .
You receive donations from your donors and then distribute funds to who has ultimate
control over how the funds are used. By allowing to control your financial decisions,
including complete control and discretion over funds and how to spend them (purchase materials
and distribute them or issue grants) an environment for allowing your funds to be used for private
benefit is created. By not requiring supporting documentation for how the funds were spent, and
only accepting reports and pictures submitted by , demonstrates your existence
privately benefits .
Additionally, resides on the property compound, in one of the guest houses, that
you paid for and maintain. office is located on the Property from which
conducts his business. Your minutes discussed the rental potential of the property and
giving a percentage of rentals as a bonus to salary. You also stated that you will
allow to build a house on the property. We took into consideration your statement that
will pay for the house with own funds. However, your organization is serving a
private interest by allowing to operate business and build house
from the property. The nature of control over financial transactions and
financial intertwining with you make it impossible to separate.
Through your lack of control and discretion over your funds, you have created an environment for
allowing your funds to be used for private benefit to insiders such as . This precludes
exemption under IRC Section 501(c)(3).
TAXPAYER'S POSITION
The taxpayer's position is unknown at this time.
CONCLUSION
Catalog Number 20810W www.irs.gov Form 886-A (Rev. 5-2017)
Page 20 of 21
Department of the Treasury - Internal Revenue Service Schedule number or
exhibit
Form 886-A Explanation of Items
Name of Taxpayer Tax Identification Number (last 4 digits) Year/Period Ended
You have failed to provide adequate documentation that you exclusively further 501(c)(3) exempt
activities. Therefore, we have no reason to believe that you are operating for exempt purposes. As
a result of the examination, we have determined that you are not operating for exempt purposes as
a §501(c)(3) organization. Accordingly, we are proposing revocation of your tax-exempt status.
Since your organization will no longer have tax-exempt status, you are liable for filing Form ,
U.S. Corporation Income Tax Return. If the proposed revocation becomes final, appropriate state
officials will be notified of such action in accordance with §6104(c) of the Internal Revenue Internal
Revenue Code.
Catalog Number 20810W www.irs.gov Form 886-A (Rev. 5-2017)
Page 21 of 21
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