IRS denies 501(c)(3) exemption to a class reunion and scholarship group

Plain-English summary

An organization open only to graduates of one high school class applied for recognition as a charity under IRC Section 501(c)(3). It arranged reunions and other events for class members and raised money for scholarships limited to family members of deceased classmates. The IRS denied exemption because the group did not provide a properly signed conformed copy of its organizing document and therefore failed the organizational test. It also failed the operational test because its reunions and narrowly targeted scholarships primarily served the private interests of class members and their families rather than the public. The group had no formal relationship with the school, which distinguished it from exempt alumni associations that operated to advance their universities. Because the organization did not protest the proposed denial within 30 days, the determination became final and contributions are not tax deductible.

Ruling snapshot

• Question: Does a single-class reunion group with scholarships for deceased classmates' family members qualify for exemption under IRC Section 501(c)(3)?
• Outcome: Denied
• Key authorities: IRC §§ 170 and 501(c)(3); Treas. Reg. §§ 1.501(c)(3)-1(a)(1), 1.501(c)(3)-1(b)(6), 1.501(c)(3)-1(c)(1), 1.501(c)(3)-1(d)(1)(ii), 1.501(c)(3)-1(d)(2), and 1.501(c)(3)-1(d)(3)(i); Rev. Ruls. 54-486, 56-403, 60-143, 61-170, 67-367, and 80-302; Rev. Proc. 2025-5; IRC § 7428(b)(2)

Full text (IRS public release)

Department of the Treasury
Internal Revenue Service
Date: 12/18/2025

Tax Exempt and Government Entities

Employer ID number:
Form you must file:
Person to contact:

Release Number: 202611010
Release Date: 3/13/26
UIL Code: 501.03-00, 501.33-00, 501.35-00

Dear

This letter is our 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). Recently, we sent
you a proposed adverse determination in response to your application. The proposed adverse determination
explained the facts, law, and basis for our conclusion, and it gave you 30 days to file a protest. Because we
didn't receive a protest within the required 30 days, the proposed determination is now final.

Because you don't qualify as a tax-exempt organization under IRC Section 501(c)(3), donors generally can't
deduct contributions to you under IRC Section 170.

We may notify the appropriate state officials of our determination, as required by IRC Section 6104(c), by
sending them a copy of this final letter along with the proposed determination letter.

You must file the federal income tax forms for the tax years shown above within 30 days from the date of this
letter unless you request an extension of time to file. For further instructions, forms, and information, visit
www.irs.gov.

We'll make this final adverse determination letter and the proposed adverse determination letter available for
public inspection after deleting certain identifying information, as required by IRC Section 6110. Read the
enclosed Letter 437, Notice of Intention to Disclose - Rulings, and review the two attached letters that show our
proposed deletions. If you disagree with our proposed deletions, follow the instructions in the Letter 437 on how
to notify us. If you agree with our deletions, you don't need to take any further action.

If you have questions about this letter, you can call the contact person shown above. If you have questions
about your federal income tax status and responsibilities, call our customer service number at 800-829-1040
(TTY 800-829-4933 for deaf or hard of hearing) or customer service for businesses at 800-829-4933.

Sincerely,

Stephen A. Martin
Director, Exempt Organizations
Rulings and Agreements

Enclosures:
Letter 437
Redacted Letter 4034
Letter 4038

Letter 4038 (Rev. 11-2021)
Catalog Number 47632S

Department of the Treasury
Internal Revenue Service
Date: 10/29/2025

Employer ID number:

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

Legend:
B = Date
C = State
D = School
E = City, State
X percent = percentage
y percent = percentage

UIL:
501.03-00
501.33-00
501.35-00

Dear

We considered your application for recognition of exemption from federal income tax under Internal Revenue
Code (IRC) Section 501(a). We determined that you don’t qualify for exemption under IRC Section 501(c)(3).
This letter explains the reasons for our conclusion. Please keep it for your records.

Issues

Do you qualify for exemption under IRC Section 501(c)(3)? No, for the reasons stated below.

Facts

You submitted Form 1023-EZ, Application for Recognition of Exemption under Section 501(c)(3) of the
Internal Revenue Code.

You attest that you were organized as an unincorporated association on B, in the State of C. You attest that you
have the necessary organizing document, that your organizing document limits your purposes to one or more
exempt purposes within the meaning of IRC Section 501(c)(3), that your organizing document does not
expressly empower you to engage in activities, other than an insubstantial part, that are not in furtherance of one
or more exempt purposes, and that your organizing document contains the dissolution provision required under
Section 501(c)(3).

You attest that you are organized and operated exclusively to further charitable purposes. You attest that you
have not conducted and will not conduct prohibited activities under IRC Section 501(c)(3). Specifically, you
attest you will:

• Refrain from supporting or opposing candidates in political campaigns in any way

• Ensure that your net earnings do not inure in whole or in part to the benefit of private shareholders or
individuals

• Not further non-exempt purposes (such as purposes that benefit private interests) more than
insubstantially

• Not be organized or operated for the primary purpose of conducting a trade or business that is not related
to your exempt purpose(s)

• Not devote more than an insubstantial part of your activities attempting to influence legislation or, if you
made a Section 501(h) election, not normally make expenditures in excess of expenditure limitations
outlined in Section 501(h)

• Not provide commercial-type insurance as a substantial part of your activities

Your Form 1023-EZ indicates you raise funds to arrange high school reunions and other events, provide
scholarship opportunities for family of deceased former class members, and educate class members about your
funding needs.

During review of your Form 1023-EZ, detailed information was requested supplemental to the above
attestations.

You registered with the State of C as a charitable organization on B. You provided a copy of your bylaws. The
bylaws did not show proof of adoption, including a specific date as to when it was adopted or the signatures of
more than one officers or directors. You attest your organizing document was amended to include an adequate
purpose and dissolution clause as required for exemption under IRC Section 501(c)(3).

You are a membership organization open to graduates of the Class of of D, located in E. Your events are
open to these graduates and their family members, but only graduates may join your organization.

You arrange annual class reunions for the purposes of promoting the wellbeing of your members and
celebrating the lives and memories of deceased classmates. You also intend on raising money for scholarships
of family members of classmates who have expired. You may also provide other financial assistance to your
members but provided no details as to the process of providing this assistance.

Only the family members of deceased members of the Class of are eligible to receive your scholarships. In
the future, you may also generate another scholarship for the general student body at D.

You state you have no intention of inviting members from past, current, or future D graduate classes to join
your organization, although they may attend your events. You have no formal relationship with D. You act in
your own interest and capacity to promote memories from your class and conduct activities honoring deceased
class members. However, you do reserve the right to establish an official partnership with D in the future.

Your estimated resources spent on these activities are x percent, with the remaining y percent spent on
fundraising activities, such as soliciting donations for your scholarships through social media. Any fees you
charge to attend your events will be determined by their related costs to ensure you are able to meet your
expenses.

Law

IRC Section 501(c)(3) provides for the recognition of exemption of organizations that are organized and
operated exclusively for charitable, educational, or other enumerated purposes as specified in the statute. No
part of the net earnings may inure to the benefit of any private shareholder or individual.

Treasury Regulation Section 1.501(c)(3)-1(a)(1) provides that in order to qualify for exemption, an organization
must be both organized and operated exclusively for one or more exempt purposes. If an organization fails to
meet either of the above tests, the organization will not qualify for exemption.

Treas. Reg. Section 1.501(c)(3)-1(b)(6) states a determination by the Commissioner that an organization is
described in IRC Section 501(c)(3) and exempt under IRC Section 501(a) will not be granted after July 26,
1959, unless such organization meets the organizational test prescribed by Treas. Reg. Section 1.501(c)(3)-
1(b)(1).

Treas. Reg. Section 1.501(c)(3)-1(c)(1) states 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 IRC Section 501(c)(3). An organization will not be so regarded if more than
an insubstantial part of its activities is not in furtherance of an exempt purpose. “Exclusivity” with respect to
IRC Section 501(c)(3) does not mean “solely” or “only” but rather “primarily” for exemption purposes.

Treas. Reg. Section 1.501(c)(3)-1(d)(1)(ii) provides that an organization is not organized or operated
exclusively for one or more exempt purposes unless it serves the public, rather than a private, interest. To meet
this requirement, it is necessary for an organization to establish that it is not organized or operated for the
benefit of private interest.

Treas. Reg. Section 1.501(c)(3)-1(d)(2) states that the term “charitable” in IRC Section 501(c)(3) includes relief
of the poor and distressed or of the underprivileged; advancement of religion; advancement of education or
science; lessening of the burdens of government; and promotion of social welfare by organizations designed to
accomplish any of the above purposes.

Treas. Reg. Section 1.501(c)(3)-1(d)(3)(i) provides that the term “educational,” as used in IRC Section
501(c)(3), relates to the instruction or training of individuals for the purpose of improving or developing their
capabilities, or the instruction of the public on subjects useful to the individual and beneficial to the community.

Revenue Ruling 54-486, 1956-2 C.B. 309, holds that an alumni association, formed by university officials, and
incorporated for the purpose of fostering fraternity among the university’s former students to promote the
general welfare of the university was exempt under IRC Section 501(c)(3). The association, subject to the
control of the university, published a periodical officially sponsored by the university and operated as an
integral part of it by performing duties which ordinarily fell within the operations of the university. The
university provided and controlled the funds by which these activities were accomplished by the university.

In Rev. Rul. 56-403, 1956-2 C.B. 307, an organization was formed to foster intellectual excellence by awarding
scholarships, open to members of all chapters of a designated fraternity, based on merit, character, and service.
In addition, the organization published literary papers and encouraged useful citizenship and amicable
relationships between individuals, student groups, and others, to promote and encourage religious, moral, civic,
and social responsibility, and made contributions to exempt organizations in these fields and otherwise. The
organization qualified as educational under IRC Section 501(c)(3) due to the totality of its activities and the fact
that the scholarships were awarded without any specific designation of persons eligible for scholarships. The
purposes of the organization were not so personal, private, or selfish in nature as to lack the element of public
benefit required for exemption under Section 501(c)(3).

Rev. Rul. 60-143, 1960-1 C.B. 192, holds that an alumni association formed to promote the interests and
general welfare of its affiliated university was exempt under IRC Section 501(c)(3). The university furnished
office space and funding in exchange for recordkeeping services. It also raised funds for the university’s
building programs, scholarships, and a student aid and loan fund, as well as published an alumni magazine.
Relying upon, in part, the ruling set forth in Rev. Rul. 54-486, its social and recreational activities were ruled as
merely incidental to its basic purpose and objective of advancing the interests of the university and, therefore,
was exempt under Section 501(c)(3).

Rev. Rul. 61-170, 1961-1 C.B. 112, holds that an association composed of professional private duty nurses and
practical nurses which supported and operated a nurses’ registry primarily to afford greater employment
opportunities for its members, operated like a commercial employment agency for the benefit of its members
and was not entitled to exemption under IRC Section 501(c)(3). Although the public received some incidental
benefit from the organization’s activities, such as a registry listing available nursing services, the primary
interests served were those of the organization’s members, who contributed the principal income to the
organization in the form of membership dues, fees, and assessments.

Rev. Rul. 67-367, 1967-2 C.B. 188, holds an organization whose sole activity was the operation of a scholarship
plan for making payments to pre-selected, specifically named individuals did not qualify for exemption under
IRC Section 501(c)(3) because it was serving the private interests of its subscribers rather than public charitable
and educational interests.

Rev. Rul. 80-302, 1980-2 C.B. 182, describes an organization’s primary activity as the compilation and
preservation of genealogical data of a particular family. Membership was limited to lineal or legal descendants.
This data was recorded and documented and held for the use of its members, and copies were made available
for a fee to any interested individuals. The organization did not qualify for exemption under IRC Section
501(c)(3) because the activities served the private interests of its members by focusing on the genealogy of a
particular family with very limited public orientation.

Revenue Procedure 2025-5, 2025-1 I.R.B. 260, states copies of the organizing or enabling document shall be
signed by a principal officer, or two members in the case of an unincorporated association, or accompanied by a
written declaration signed by an authorized individual certifying that the document is a complete and accurate
copy of the original or otherwise satisfies the requirements of a “conformed copy,” as outlined in Rev. Proc. 68-
14, 1968-1 C.B. 768.

Application of law

IRC Section 501(c)(3) and Treas. Reg. Section 1.501(c)(3)-1(a)(1) set forth two main tests for an organization
to be recognized as exempt. An organization must meet both the organizational test and the operational test
exclusively for purposes described in Section 501(c)(3). Based on the information provided in your application
and supporting documentation, you have not shown you meet either test as described below.

Per Treas. Reg. Section 1.501(c)(3)-1(b)(6), you do not satisfy the organizational test because you failed to
provide a copy of your organizing document with the required signatures as described in Revenue Procedure
2025-5. Although you attested your organizing document was amended to meet the organizational test, you did
not provide a conformed copy of it. Neither your registration as a charitable organization with the State of B,
nor your undated and unsigned bylaws, satisfy the organizational test under IRC Section 501(c)(3).

You do not meet the operational test because you have failed to show you are operating exclusively for exempt
purposes as required under Treas. Reg. Section 1.501(c)(3)-1(c)(1). Your two primary activities are as follows:

(i) arranging class reunions and other events for your limited membership

(ii) fundraising to provide scholarships for the family members of deceased graduates

Neither of these activities were shown by you to exclusively further exempt purposes under IRC Section
501(c)(3). Even though you stated your events are open to other graduating classes of D, you primarily operate
to arrange annual class reunions for the social enjoyment of your limited membership. You may also intend to
operate a future scholarship open to the general student body at D, but you primarily fundraise to provide
scholarships for the family members of deceased graduates of your high school class. Contrary to the provisions
of Treas. Reg. Section 1.501(c)(3)-1(d)(1)(ii), these activities serve your private interests, not the public interest.

Like the organization in Rev. Rul. 61-170, which was denied exemption because it served the private interests
of its members by operating a fee-based commercial employment agency, you are furthering private interests by
fundraising and collecting fees to arrange class reunions so your members may socialize and reminisce, as
well as honor deceased classmates and provide their families with scholarships. You are also similar to the
organization denied exemption in Rev. Rul. 80-302 for operating a genealogical database for members of a
particular family. You also operate to provide members of a particular graduating class with activities and
information primarily relevant to them, even though other graduating classes of D may also attend your events.
Accordingly, you have not shown any charitable or educational components that predominate here.

As described in Treas. Reg. Section 1.501(c)(3)-1(d)(2), you have not shown how your activities advance
science, education, or religion, nor how your activities lessen the burdens of government, promote social
welfare, or provide relief to the poor and distressed and underprivileged. Instead, your fundraising is primarily
directed at arranging class reunions for the social enjoyment and comradery of your members and providing
scholarships to deceased class members’ families, which do not further exempt purposes under IRC Section
501(c)(3). You have not demonstrated that your members or scholarship recipients are poor, distressed, or
underprivileged, nor have you described in detail how annual class reunions and designated scholarships for
specific family members of deceased classmates promotes social welfare to a substantial degree which qualifies
you for exemption under Section 501(c)(3), such as combatting community deterioration or defending human
and civil rights secured by law as described in Treas. Reg. Section 1.501(c)(3)-1(d)(2).

You have also not shown how your activities further educational purposes as described in Treas. Reg. Section
1.501(c)(3)-1(d)(3)(i). Your activities do not include any instruction or training of individuals or the public on
subjects useful to the individual and beneficial to the community, and your scholarships are awarded in too
narrow of a manner without charitable intent to show a substantial benefit to the community.

Similar to the organization in Rev. Rul. 67-367, which was denied exemption for operating a scholarship plan
for pre-selected individuals, you also operate a scholarship where designated beneficiaries are pre-selected
based upon the deaths of graduating class members. Further, unlike the organization in Rev. Rul. 56-403, where
its pool of scholarship candidates was broad enough to further the public interest under IRC Section 501(c)(3),
your scholarship is awarded to family members of deceased classmates, making it too personal and private in its
criteria to fulfill the element of public benefit required for exemption under IRC Section 501(c)(3).

Finally, you are unlike the alumni associations in Rev. Rul. 54-486 and Rev. Rul. 60-143, which were held
exempt for promoting the interests and general welfare of their affiliated universities through educational
activities. In contrast to these organizations, you do not have an official affiliation or relationship with D, and D
does not provide you with any resources, such as office space or funding, to conduct any activities on its behalf.
You act in your own capacity to serve the private interests of your members through fundraising to conduct
social activities and provide scholarships for deceased graduates’ family members. You do not conduct other
activities, such as publishing an alumni magazine or periodicals sponsored by D or raise funds for D's buildings.

Conclusion

You do not qualify for federal tax exemption under IRC Section 501(c)(3) because your activities are not
operated exclusively for exempt purposes. Fundraising to arrange class reunions and other events for your
limited membership and provide scholarships for the family members of deceased graduates serve private
interests and do not further any exempt purposes under Section 501(c)(3). Therefore, you are not exempt, and
contributions to you are not tax deductible.

If you agree

If you agree with our proposed adverse determination, you don’t need to do anything. If we don’t hear from
you within 30 days, we'll issue a final adverse determination letter. That letter will provide information on
your income tax filing requirements.

If you don't agree

You have a right to protest if you don’t agree with our proposed adverse determination. To do so, send us a
protest within 30 days of the date of this letter. You must include:

• Your name, address, employer identification number (EIN), and a daytime phone number

• A statement of the facts, law, and arguments supporting your position

• A statement indicating whether you are requesting an Appeals Office conference.

• The signature of an officer, director, trustee, or other official who is authorized to sign for the
organization or your authorized representative.

• The following declaration:

For an officer, director, trustee, or other official who is authorized to sign for the organization:
Under penalties of perjury, I declare that I have examined this request, or this modification to the
request, including accompanying documents, and to the best of my knowledge and belief, the request
or the modification contains all relevant facts relating to the request, and such facts are true, correct,
and complete.

Your representative (attorney, certified public accountant, or other individual enrolled to practice before the
IRS) must file a Form 2848, Power of Attorney and Declaration of Representative, with us if they haven’t
already done so. You can find more information about representation in Publication 947, Practice Before the
IRS and Power of Attorney.

We’ll review your protest statement and decide if you gave us a basis to reconsider our determination. If so,
we’ll continue to process your case considering the information you provided. If you haven’t given us a basis
for reconsideration, we’ll send your case to the Appeals Office and notify you. You can find more information
in Publication 892, How to Appeal an IRS Determination on Tax-Exempt Status.

If you don’t file a protest within 30 days, you can’t seek a declaratory judgment in court later because the
law requires that you use the IRC administrative process first (IRC Section 7428(b)(2)).

Where to send your protest

Send your protest, Form 2848, if applicable, and any supporting documents to the applicable address:

U.S. mail:
Internal Revenue Service
EO Determinations Quality Assurance
Mail Stop 6403
PO Box 2508
Cincinnati, OH 45201

Street address for delivery service:
Internal Revenue Service
EO Determinations Quality Assurance
550 Main Street, Mail Stop 6403
Cincinnati, OH 45202

You can also fax your protest and supporting documents to the fax number listed at the top of this letter. If you
fax your statement, please contact the person listed at the top of this letter to confirm that they received it.

You can get 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 listed at
the top of this letter.

Contacting the Taxpayer Advocate Service

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 if 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.

Sincerely,

Stephen A. Martin
Director, Exempt Organizations
Rulings and Agreements

Letter 4034 (Rev. 01-2021)
Catalog Number 47628K