Internal Revenue Service
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 Rev. Rul. 76-27

1976-1 C.B. 64

Section 170

IRS Headnote

Publicly supported organization rulings. An organization described in section 501(c)(3) of the Code having a first taxable year consisting of exactly eight months and that meets the requirements of section 170(b)(1)(A)(vi) is entitled to a ruling or determination letter that it is not a private foundation.

Full Text

Rev. Rul. 76-27

Advice has been requested whether, under the circumstances set out below, an organization has existed for sufficient time to receive a ruling or determination letter that it is a publicly supported organization described in section 170(b)(1)(A)(vi) of the Internal Revenue Code of 1954.

The organization, described in section 501(c)(3) of the Code, was created on May 1, 1971, and adopted the calendar year as its taxable year. In 1972 it asked the Internal Revenue Service to classify it as other than a private foundation because it is an organization described in section 170(b)(1)(A)(vi). In connection with its request, the organization submitted information showing that it met the requirements of an organization described in section 170(b)(1)(A)(vi) for its first taxable year ending December 31, 1971.

Section 509(a) of the Code defines a "private foundation" as an organization described in section 501(c)(3) other than an organization specifically excluded by section 509(a). Section 509(a)(1) states that the term "private foundation" does not include an organization described in section 170(b)(1)(A) (other than in clauses (vii) and (viii)).

Section 1.170A-9(e)(4)(vi) of the Income Tax Regulations provides that an organization that meets the requirements of section 170(b)(1)(A)(vi) of the Code and the regulations thereunder and has been in existence for at least one taxable year consisting of eight or more months may be issued a ruling or determination letter that it is an organization described in section 170(b)(1)(A)(vi).

Section 1.170A-9(e)(5)(v)(b) of the regulations provides that the initial determination of the status of a newly created organization under section 170(b)(1)(A)(vi) of the Code is to be based on a special short computation period. In the case of an organization whose first taxable year is at least eight months, this "computation period" is either the first taxable year or the first two taxable years.

The organization in this case has met the requirements of section 170(b)(1)(A)(vi) of the Code and the regulations thereunder and has completed one taxable year consisting of eight months. Accordingly, it is entitled to a ruling or determination letter that it is not a private foundation.

If the organization had not met the requirements of section 170(b)(1)(A)(vi) of the Code for its first taxable year its computation period would then be the first two taxable years.