IRS revokes a 501(c)(3)'s exemption after it would not produce records to prove it met the organizational and operational tests

Plain-English summary

This is a final adverse determination revoking an organization's tax-exempt
status under Section 501(c)(3). The group had obtained recognition by filing
a streamlined Form 1023-EZ and was later selected for audit. The attached
Form 886-A documents a long chain of outreach: three information document
requests, many mailed letters (several returned undeliverable), and dozens of
phone calls to officers. The organization gave a partial first response
(bylaws that lacked a proper purpose and dissolution clause and were not
signed, articles of incorporation for a differently named entity, meeting
minutes, and bank statements that did not reconcile with its return), but did
not supply the additional records the IRS needed. Because a 501(c)(3) must
keep records and let the IRS inspect them (Sections 6001 and 6033) and must
prove it is both organized and operated exclusively for exempt purposes, the
failure to respond meant the group could not establish that it still
qualified. The IRS revoked the exemption, which ends the deductibility of
contributions under Section 170.

Ruling snapshot

• Question: Should the organization's 501(c)(3) exemption be revoked after it failed to respond and produce records substantiating the organizational and operational tests?
• Outcome: Revocation of exempt status
• Key authorities: IRC §§ 501(c)(3), 501(a), 511, 6001, 6033(a)(1), 170, 7428; Treas. Reg. §§ 1.501(c)(3)-1, 1.6001-1, 1.6033-1, 1.6033-2, 1.61-1; Rev. Rul. 59-95

Full text (IRS public release)

Department of the Treasury Date:
Internal Revenue Service October 25, 2022
IRS Tax Exempt and Government Entities Taxpayer ID number (last 4 digits):

Form:

Release Number: 202317024 Tax periods ended:

Release Date: 4/28/2023 Person to contact:
UIL Code: 501.03-00 Name:

ID number:
Telephone:
Fax:

Last day to file petition with United States
Tax Court:
January 23, 2023

CERTIFIED MAIL - Return Receipt Requested
Dear :

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
produce documents to establish that you are organized and operated exclusively for exempt purposes within the
meaning of IRC Section 501(c)(3). You failed to respond to repeated reasonable requests to allow the Internal
Revenue Service to examine your records regarding your organization and activities as required by IRC
Sections 6001, 6033(a)(1), and Revenue Ruling 59-95, 1959-1 C.B. 627. In our letters dated .

, and , we requested information necessary to conduct an examination of your
Form for the year ended . We have not received the requested information. Section
1.6033-2(i)(2) of the Income Tax Regulations provides, in part, that every organization which is exempt from
tax, shall submit such additional information as may be required by the Internal Revenue Service for the
purpose of inquiring into its exempt status. Since you have not provided the requested information, you have
failed to establish that you are operated exclusively for exempt purposes within the meaning of IRC Section 501
(c)(3) and that no part of your net earnings inure 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 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 can file an action for declaratory judgment under the provisions
of Section 7428 of the Code in either:

• The United States Tax Court,
• The United States Court of Federal Claims, or
• The United States District Court for the District of Columbia

Letter 6337 (Rev. 8-2022)
Catalog Number 74808E

You must file a petition or complaint in one of these three courts within 90 days from the date we mailed this
determination letter to you. You can download a fillable petition or complaint form and get information about
filing at each respective court's website listed below or by contacting the Office of the Clerk of the Court at one
of the addresses below. Be sure to include a copy of this letter and any attachments and the applicable filing fee
with the petition or complaint.

You can eFile your completed U.S. Tax Court petition by following the instructions and user guides available
on the Tax Court website at ustaxcourt.gov/dawson.html. You will need to register for a DAWSON account to
do so. You may also file your petition at the address below:

United States Tax Court
400 Second Street, NW
Washington, DC 20217
ustaxcourt.gov

The websites of the U.S. Court of Federal Claims and the U.S. District Court for the District of Columbia contain
instructions about how to file your completed complaint electronically. You may also file your complaint at one of
the addresses below:

US Court of Federal Claims

717 Madison Place, NW

Washington, DC 20439

uscfc.uscourts.gov

US District Court for the District of Columbia
333 Constitution Avenue, NW

Washington, DC 20001

dcd.uscourts.gov

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.

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:

Internal Revenue Service
Taxpayer Advocate Office

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.

Letter 6337 (Rev. 8-2022)
Catalog Number 74808E

Find tax forms or publications by visiting 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.

You may fax your documents to the fax number shown above, using either a fax machine or online fax service.
Protect yourself when sending digital data by understanding the fax service's privacy and security policies.

Keep the original letter for your records.

Sincerely,

Lyna A. Brinkley

Acting Director, Exempt Organizations Examinations

Enclosures:
Publication 1
Publication 594
Publication 892

Letter 6337 (Rev. 8-2022)
Catalog Number 74808E

Department of the Treasury Date: March 4, 2022

Internal Revenue Service Taxpayer ID number:
IRS Tax Exempt and Government Entities

Form:
Tax periods ended:

Person to contact:
Name:
ID number:
Telephone:
Fax:

Manager's contact information:
Name:
ID number:

Telephone:
Response due date:
April 04, 2022

CERTIFIED MAIL - Return Receipt Requested
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.

After we issue the final adverse determination letter, we'll announce that your organization is no
longer eligible to receive tax deductible contributions under IRC Section 170.

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

Letter 3618 (Rev. 8-2019)
Catalog Number 34809F

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.

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.

For 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,
Lyna A. Brinkley

Acting Director, Exempt Organizations

Examinations
Enclosures:
Form 886-A
Form 6018
Form 4621-A
Publications 892 & 3498-A

Letter 3618 (Rev. 8-2019)
Catalog Number 34809F

Form 886-A, Explanations of Items
Department of the Treasury — Internal Revenue Service
Name of taxpayer | Tax Identification Number (last 4 digits) | Year/Period ended

Date of Notice:
Issues

Whether the organization , which qualified for
exemption from Federal income tax under Section 501(c)(3) of the Internal Revenue Code, should
be revoked due to failing to fully respond and produce records to substantiate that the organization
is meeting the organizational and operational tests?

Facts

applied for tax-exempt status by filing the
Form 1023-EZ, Streamlined Application for Recognition of Exemption Under Section 501(c)(3) of
the Internal Revenue Code, on , and was granted tax-exempt status as a
501(c)(3) on , with an effective date of

An organization exempt under 501(c)(3) needs to be organized and operated exclusively for
religious, charitable, scientific, testing for public safety, literary or educational purposes and to
foster national and amateur sports competition.

Form 1023-EZ shows the organization is a corporation incorporated in the State of on
. The organization attested on Form 1023-EZ, part II, box 2 that they have the
organizing document necessary for their organizational structure.

Section 501(c)(3) requires that an organizing document must limit your purposes to one or more
exempt purposes within section 501(c)(3). The organization attested that their organizing
document contains this limitation.

The organization attested that their organizing document contains the dissolution provision
required under section 501(c)(3) or that they did not need an express dissolution provision in your
organizing document because they rely on the operation of state law in the state in which you are
formed for your dissolution provision.

The State of does require a dissolution provision.

The organization was selected for audit to ensure that the activities and operations align with
their approved exempt status.

The organization responded to the first Information Document Request (IDR) issued on
. The response was received by the Internal Revenue Service on
and included the following documents:
e Copy of Bylaws
e Organizational Documents for

Catalog Number 20810W Page 1 www.irs.gov Form 886-A (Rev. 5-2017)

Form 886-A, Explanations of Items
Name of taxpayer | Tax Identification Number (last 4 digits) | Year/Period ended
e Meeting Minutes for , through
e Bank Statements for , through
The organization did provide a copy of Bylaws, but it

did not include an appropriate purpose and dissolution clause for a Section 501(c)(3)
organization, and they were not signed.

Articles of Incorporation were provided for an organization named

. No documentation was provided to show that they filed a name change with the
Secretary of State and were accepted under the new name and employer identification number
of

The Secretary of State showed that did file
Articles of Incorporation and Articles of Amendment. The Secretary of State does not provide
copies of filed documents.

The meeting minutes were reviewed and some activities were identified. Activities identified in
the meeting minutes were:

and Camp
Car Wash
Bake Sale
Annual Banquet
Raffle

The meeting minutes did not satisfy the operational test. There was not enough information or
details provided about the activities to determine if the activities support the exempt purpose of
the organization.

Credits, debits, and assets from the bank statements did not reconcile with the Form

. Discrepancies could not be identified. Cash withdrawals and expenses were identified that
were not reported on Form . Cash deposits were made on the bank statements and did
not reconcile with revenue reported on Form

Based on the information provided in the bank statements, it could not be determined the
sources of income and expenses were related to the exempt purpose of the organization and
could not rule out private benefit, therefore did not pass the operational test.

A 2nd IDR was issued on , with a response due date of

The second IDR requested additional information to verify the organization passes the
Organizational Test and Operational Test as required for a 501(c)(3) organization. Items
requested in the 2nd IDR include:

Catalog Number 20810W Page 2 www.irs.gov Form 886-A (Rev. 5-2017)

Form 886-A, Explanations of Items
Name of taxpayer | Tax Identification Number (last 4 digits) | Year/Period ended
e Organizational documents for filed with the
Secretary of State.
e Additional information about the gun raffle.
e Details regarding activities identified in the meeting minutes.
e A copy of the Registration Form.
e Additional information was requested to verify and review income, expenses, and assets.
A 3rd IDR was issued on , with a response due date of . The

3rd IDR listed documents that were received in the response and reiterated
documents/information requested on the 2nd IDR that still were needed. The Administrative
Record was also shared with the organization at this time.

The organization failed to fully respond to the Internal Revenue Service attempts to obtain
information to perform an audit of Form for the tax year ending

The organization has not filed a Form series return for the tax year ending

The Form 1023-EZ application lists the phone number of for the treasurer of

As of , per the State of website, it lists the organizations status as
exists, copy attached from state website.

e Correspondence for the audit was as follows:

o Letter 6031 (Rev. 11-2020) with attachments, was mailed to the organization on
, with a response date of . This letter was not return by the post
office as being undeliverable.

o Letter 3844-A (12-2015) with attachments, was mailed certified to the organization on
, with a response date of , Article Number
. Per the United States Postal Service (USPS) tracking, this was returned on
as BOX CLOSED, UNABLE TO FORWARD, RETURN TO SENDER. This letter was
received back at the Internal Revenue Service on

o Letter 3844-A (12-2015), with attachments, was mailed certified to the organization,
per Form 1023-EZ application, on , with a response date of
. Article Number . Per USPS tracking this was
RETURNED TO SENDER, UNABLE TO FORWARD and returned to the Internal
Revenue Service. This letter was received back at the Internal Revenue Service on

Catalog Number 20810W Page 3 www.irs.gov Form 886-A (Rev. 5-2017)

Form 886-A, Explanations of Items
Name of taxpayer | Tax Identification Number (last 4 digits) | Year/Period ended

o Letter 3844-A (12-2015), with attachments, was mailed to the President, per Form
1023-EZ application, on , with a response date of . Article
Number . This letter was delivered on
Green Card Receipt was received back at the Internal Revenue Service on

o Letter 3844-A (12-2015), with attachments, was mailed to the Vice President, per
Form 1023-EZ application, on , with a response date of
Article Number . This letter was delivered on
. Green Card Receipt was received back at the Internal Revenue Service on

o Letter 3844-A (12-2015), with attachments, was mailed to the organization, per
on , with a response date of
. This letter was not return by the post office as being
undeliverable.

o Letter 3844-A (12-2015), with attachments, was mailed to the President, per phone
conversation with President on , with a response date of
. This letter was not return by the post office as being undeliverable.

o Letter 3844-A (12-2015), with attachments, was also emailed via secure zip to
on , with a response date of

o Letter 5077-B (1-2017), TE/GE IDR Delinquency Notice, was mailed to the President,
on , with a response date of . Article Number
. This letter was delivered on . Green
Card Receipt was received back at the Internal Revenue Service on

o The Organization mailed in a response, and it was received by the Internal Revenue
Service on

o Letter 3844-B (11-2015), and second Information Document Request, was mailed to
the President on , with a response date of .
Article Number . This letter still currently shows In Transit,
and no Green Card Receipt was received back at the Internal Revenue Service.

o Letter 3844-A (10-2021), and second Information Document Request, was mailed to
the President on , with a response due date of
Article Number . This letter was delivered on
. Green Card Receipt was received back at the Internal Revenue Service on

Catalog Number 20810W Page 4 www.irs.gov Form 886-A (Rev. 5-2017)

Form 886-A, Explanations of Items
Name of taxpayer | Tax Identification Number (last 4 digits) | Year/Period ended

o Letter 5077-B (1-2017), TE/GE IDR Delinquency Notice, third Information Document
Request, and Administrative File was mailed to the President, on ,
with a response date of . Article Number
4935. Letter was picked up by individual at the Post Office on

Green Card Receipt currently has not been received back at the Internal Revenue
Service.

The Administrative File included:
e Form 1023EZ, Streamlined Application of Recognition of Exemption Under Section
IRC 501(c)(3) of the Internal Revenue Code

e Letter 947, 501(c)(3) Exemption with Definitive Ruling of Public Charity Status
e Form

e Telephone contact for the audit was as follows:

o , Tax Compliance Officer (TCO) called the phone number listed on
Form 1023-EZ application and Form for the Treasurer of
and received VMS. Left a message for an
officer of the organization to return phone call.

o , Tax Compliance Officer (TCO) called the phone number listed on
Form 1023-EZ application and the Form for the Treasurer of
and received voice mail (VMS).
Left a message for an officer of the organization to return phone call.

returned phone call. She is no longer the Treasurer
but provided phone number for the new treasurer,

o , Tax Compliance Officer (TCO) called at
and received VMS. Left a message for an officer of the organization to return phone
call.

o , Tax Compliance Officer (TCO) researched Accurint for phone
numbers for President listed on Form 1023-EZ. Called and
and received VMS. Left a message for officer of the organization to return
phone call. No other numbers were successful.

o , TCO received a call from . She received a letter at
address. Letter was returned to sender and TCO verified this was not a good
address for the organization.

Catalog Number 20810W Page 5 www.irs.gov Form 886-A (Rev. 5-2017)

Form 886-A, Explanations of Items
Name of taxpayer | Tax Identification Number (last 4 digits) | Year/Period ended
o , TCO called at and received VMS. Left a
message for an officer of the organization to return phone call.
o , TCO called President listed on Form 1023-EZ at and
and and received VMS for both numbers. Left a
message for an officer of the organization to return phone call.
o , TCO called at and received VMS. Left a
message for an officer of the organization to return phone call.
o , TCO received a call from . Letter was received at

address. He is not associated with the organization. Verified
incorrect address for organization.

o , TCO attempted to call President listed on Form 1023-EZ and
received VMS. Left a message for an officer of the organization to return phone call.

o , TCO located phone number for . TCO called
and left a message with the receptionist to have an officer of the
organization to return phone call.

o , TCO spoke with , Secretary at

. A letter was received at the school for the organization, but she stated that
they are not associated with the organization. Provided number for President of the
organization, ( ). , TCO called

( ). TCO verified current President of the organization. President
provided new address for the organization and verbally agreed to have L3844-A sent
via email. TCO provided password to open secure zip file that included L3844-A,
Information Document Request (IDR), and attachments.

o , TCO called President and left Message on voice mail.

o , TCO called President and left Message on voice mail.

o , TCO called President and left Message on voice mail.

o , TCO called President and Treasurer and left message that second

IDR is being mailed on

o , TCO called President and Treasurer and left messages on voice
mail.

o , TCO called President and Treasurer and left messages on voice

Catalog Number 20810W Page 6 www.irs.gov Form 886-A (Rev. 5-2017)

Form 886-A, Explanations of Items
Name of taxpayer | Tax Identification Number (last 4 digits) | Year/Period ended
mail.
o , TCO called President and Treasurer and left messages on voice
mail.
o , TCO called President and Treasurer and left message that Form

886-A will be mailed in within the next few weeks. Please return call.
Law

Internal Revenue Code (IRC) §501(c)(3) of the Code provides that an organization organized
and operated exclusively for charitable or educational purposes is exempt from Federal income
tax, provided no part of its net earnings inures to the benefit of any private shareholder or
individual.

IRC §511 of the Internal Revenue Code imposes a tax at corporate rates under section 11 on the
unrelated business taxable income of certain tax-exempt organizations.

IRC §6001 of the Code provides that every person liable for any tax imposed by this title, or for the
collection thereof, shall keep such records, render such statements, make such returns, and
comply with such rules and regulations as the Secretary may from time to time prescribe.
Whenever in the judgment of the Secretary it is necessary, he may require any person, by notice
served upon such person or by regulations, to make such returns, render such statements, or
keep such records, as the Secretary deems sufficient to show whether or not such person is liable
for tax under this title.

IRC §6033(a)(1) of the Code provides, except as provided in section 6033(a)(2), every
organization exempt from tax under section 501(a) shall file an annual return, stating specifically
the items of gross income, receipts and disbursements, and such other information for the
purposes of carrying out the internal revenue laws as the Secretary may by forms or regulations
prescribe, and keep such records, render under oath such statements, make such other returns,
and comply with such rules and regulations as the Secretary may from time to time prescribe.

Treasury Regulations (Regulation) 1.501(c)(3)-1 In order to be exempt under §501(c)(3) the
organization must be both organized and operated exclusively for one or more of the purposes
specified in the section. (religious, charitable, scientific, testing for public safety, literary or
educational).

Regulation §1.501(c)(3)-1(a)(1) of the regulations states that in order to be exempt as an
organization described in section 501(c)(3), an organization must be both organized and operated
exclusively for one or more of the purposes specified in such section. If an organization fails to
meet either the organizational test or the operational test, it is not exempt.

Catalog Number 20810W Page 7 www.irs.gov Form 886-A (Rev. 5-2017)

Form 886-A, Explanations of Items
Name of taxpayer | Tax Identification Number (last 4 digits) | Year/Period ended

Regulation §1.501(c)(3)-1(c)(1) of the regulations provides that an organization will not be
regarded as "operated exclusively" for one or more exempt purposes described in section
501(c)(3) of the Code if more than an insubstantial part of its activities is not in furtherance of a
501(c)(3) purpose. Accordingly, the organization does not qualify for exemption under section
501(c)(3) of the Code.

Regulation §1.6001-1(c) of the Code provides that such permanent books and records as are
required by paragraph (a) of this section with respect to the tax imposed by section 511 on
unrelated business income of certain exempt organizations, every organization exempt from tax
under section 501(a) shall keep such permanent books of account or records, including
inventories, as are sufficient to show specifically the items of gross income, receipts and
disbursements. Such organizations shall also keep such books and records as are required to
substantiate the information required by section 6033. See section 6033 and §§ 1.6033-1 through
1.6033-3.

Regulation §1.6001-1(e) of the Code provides that the books or records required by this section
shall be kept at all times available for inspection by authorized internal revenue officers or
employees, and shall be retained as long as the contents thereof may be material in the
administration of any internal revenue law.

Regulation §1.6033-1(h)(2) of the regulations provides that every organization which has
established its right to exemption from tax, whether or not it is required to file an annual return of
information, shall submit such additional information as may be required by the district director for
the purpose of enabling him to inquire further into its exempt status and to administer the
provisions of subchapter F (section 501 and the following), chapter 1 of the Code and section
6033.

Regulation §1.6033-2(a)(1) of the Regulations provides, in part, that, except for certain
exceptions not here applicable, every organization exempt from taxation under section 501(a)
shall file an annual information return specifically setting forth its items of gross income, gross
receipts and disbursements, and such other information as may be prescribed in the instructions
issued with respect to the return.

Regulation §1.6033-2(i)(2) of the Regulations provides, in part, that every organization which is
exempt from tax, whether or not it is required to file an annual information return, shall submit such
additional information as may be required by the Internal Revenue Service for the purpose of
inquiring into its exempt status and administering the provisions of subchapter F, chapter 1 of
subtitle A of the Code, section 6033, and chapter 42 of subtitle D of the Code.

Regulation §1.61-1 of the regulations provides that Gross income means all income from
whatever source derived, unless excluded by law. Gross income includes income realized in any
form, whether in money, property, or services. Income may be realized, therefore, in the form of
services, meals, accommodations, stock, or other property, as well as in cash.

Catalog Number 20810W Page 8 www.irs.gov Form 886-A (Rev. 5-2017)

Form 886-A, Explanations of Items
Name of taxpayer | Tax Identification Number (last 4 digits) | Year/Period ended

Rev. Rul. 59-95, 1959-1 C.B. 627, concerns an exempt organization that was requested to
produce a financial statement and statement of its operations for a certain year. However, its
records were so incomplete that the organization was unable to furnish such statements. The
Service held that the failure or inability to file the required information return or otherwise to
comply with the provisions of section 6033 of the Code and the regulations which implement it,
may result in the termination of the exempt status of an organization previously held exempt, on
the grounds that the organization has not established that it is observing the conditions required
for the continuation of exempt status.

Organization's Position
Taxpayer's position is unknown at this time.
Government's Position

Based on the above facts, the organization did not fully respond to substantiate that they are
organized and operated exclusively for one or more of the purposes specified in IRC Section
501(c)(3). If an organization fails to meet either the organizational test or the operational test, it
is not exempt.

Articles of Incorporation that were submitted were for a different organization and employer
identification number. The bylaws that were also submitted with the organizations name on it
did not contain an appropriate purpose and dissolution clause and it was not signed. Therefore,
they are not meeting the organizational test.

In reviewing the minutes some activities were identified in which additional information and
clarification was requested. In reviewing the bank statements additional information and
clarification was requested to identify discrepancies and verify transactions. No additional
responses were received and we were unable to contact someone through phone contacts to
gain a better understanding of their activities and financial transactions. Therefore, we were
unable to determine if their activities were primarily for one or more exempt purposes as
specified in IRC Section 501(c)(3) and unable to rule out any private benefit. At this time, we
are unable to determine if they meet the operational test.

In accordance with the above-cited provisions of the Code and regulations under sections 6001
and 6033, organizations recognized as exempt from federal income tax must meet certain
reporting requirements. These requirements relate to the filing of a complete and accurate
annual information (and other required federal tax forms) and the retention of records sufficient
to determine whether such entity is operated for the purposes for which it was granted tax-
exempt status and to determine its liability for any unrelated business income tax.

Section 1.6033-1(h)(2) of the regulations specifically state that exempt organizations shall

Catalog Number 20810W Page 9 www.irs.gov Form 886-A (Rev. 5-2017)

Form 886-A, Explanations of Items
Name of taxpayer | Tax Identification Number (last 4 digits) | Year/Period ended

submit additional information for the purpose of enabling the Internal Revenue Service to
inquire further into its exempt status.

Using the rationale that was developed in Revenue Ruling 59-95, the Organization's failure to
provide requested information should result in the termination of exempt status.

Conclusion

Based on the foregoing reasons, the organization does not qualify for exemption under section
501(c)(3) and its tax-exempt status should be revoked.

It is the IRS's position that the organization failed to establish that it meets the reporting
requirements under IRC §§ 6001 and 6033 to be recognized as exempt from federal income tax
under IRC § 501(c)(3). Furthermore, the organization has not established that it is observing
the conditions required for the continuation of its exempt status or that it is organized and
operated exclusively for an exempt purpose. Accordingly, the organization's exempt status is
revoked effective .

Catalog Number 20810W Page 10 www.irs.gov Form 886-A (Rev. 5-2017)