Court upholds denial of tax exemptions

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The Indiana Tax Court Tuesday ruled that the state Board of Tax Review did not err when it determined a nonprofit in Mooresville was not entitled to either a fraternal beneficiary association exemption or a charitable purposes exemption for the 2006 tax year.

The Fraternal Order of Eagles #3988, a mutual benefit corporation, is a nonprofit whose motto is “People helping People.” It owned a lodge in Mooresville used to raise funds for charitable organizations, collect donations for needy family and to host private events for its members. In 2006, Eagles sought either a fraternal beneficiary association exemption or a charitable purposes exemption for the 2006 tax year on its real and personal property, which was denied by the county property tax assessment board of appeals.

The Indiana Board of Tax Review held a hearing at which Eagles presented its charitable donation records for 2003 through 2006, its monthly profit/loss statements for 2005, several affidavits, and a usage study to show that it used its property for fraternal and charitable purposes. The tax board denied the exemptions, which the Indiana Tax Court upheld in Fraternal Order of Eagles #3988, Inc. v. Morgan County Property Tax Assessment Board of Appeals and Morgan County Assessor, 49T10-1201-TA-4.

Eagles claimed the board’s determination that it failed to establish a prima facie case that it was entitled to the fraternal beneficiary association exemption under Indiana Code 6-1.1-10-23 or to the charitable purposes exemption under Indiana Code 6-1.1-10-16 is contrary to law and unsupported by substantial evidence.

“Eagles was required to present probative evidence demonstrating that it satisfies the statutory definition of a fraternal beneficiary association set forth in Indiana Code § 27-11-1-1. Eagles’ recognition as an I.R.C. § 501(c)(8) fraternal beneficiary society, order, or association for federal income tax purposes does not, by itself, establish that Eagles met all the definitional requirements contained in Indiana Code § 27-11-1-1. Moreover, Eagles failed to show how its other documentary and testimonial evidence satisfied each element of the definition of a ‘fraternal beneficiary association’ as defined under Indiana Code § 27-11-1-1,” Judge Martha Wentworth wrote.

Eagles’ evidence didn’t indicate whether it has a representative form of government as required under the statute, and the evidence could not independently demonstrate that Eagles met the six statutorily prescribed elements of the definition of “fraternal beneficiary association.”

Eagles used its property both for a variety of social and recreational purposes and for charitable purposes, but the usage report didn’t provide the board with a comparison of the relative amounts of time that the lodge was used for exempt and non-exempt purposes, Wentworth wrote. Eagles’ failure to provide this comparison was fatal to its claim for either a full or a partial exemption regarding the charitable purposes exemption.  



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  1. Especially I would like to see all the republican voting patriotic good ole boys to stop and understand that the wars they have been volunteering for all along (especially the past decade at least) have not been for God & Jesus etc no far from it unless you think George Washington's face on the US dollar is god (and we know many do). When I saw the movie about Chris Kyle, I thought wow how many Hoosiers are just like this guy, out there taking orders to do the nasty on the designated bad guys, sometimes bleeding and dying, sometimes just serving and coming home to defend a system that really just views them as reliable cannon fodder. Maybe if the Christians of the red states would stop volunteering for the imperial legions and begin collecting welfare instead of working their butts off, there would be a change in attitude from the haughty professorial overlords that tell us when democracy is allowed and when it isn't. To come home from guarding the borders of the sandbox just to hear if they want the government to protect this country's borders then they are racists and bigots. Well maybe the professorial overlords should gird their own loins for war and fight their own battles in the sandbox. We can see what kind of system this really is from lawsuits like this and we can understand who it really serves. NOT US.... I mean what are all you Hoosiers waving the flag for, the right of the president to start wars of aggression to benefit the Saudis, the right of gay marriage, the right for illegal immigrants to invade our country, and the right of the ACLU to sue over displays of Baby Jesus? The right of the 1 percenters to get richer, the right of zombie banks to use taxpayer money to stay out of bankruptcy? The right of Congress to start a pissing match that could end in WWIII in Ukraine? None of that crud benefits us. We should be like the Amish. You don't have to go far from this farcical lawsuit to find the wise ones, they're in the buggies in the streets not far away....

  2. Moreover, we all know that the well heeled ACLU has a litigation strategy of outspending their adversaries. And, with the help of the legal system well trained in secularism, on top of the genuinely and admittedly secular 1st amendment, they have the strategic high ground. Maybe Christians should begin like the Amish to withdraw their services from the state and the public and become themselves a "people who shall dwell alone" and foster their own kind and let the other individuals and money interests fight it out endlessly in court. I mean, if "the people" don't see how little the state serves their interests, putting Mammon first at nearly every turn, then maybe it is time they wake up and smell the coffee. Maybe all the displays of religiosity by American poohbahs on down the decades have been a mask of piety that concealed their own materialistic inclinations. I know a lot of patriotic Christians don't like that notion but I entertain it more and more all the time.

  3. If I were a judge (and I am not just a humble citizen) I would be inclined to make a finding that there was no real controversy and dismiss them. Do we allow a lawsuit every time someone's feelings are hurt now? It's preposterous. The 1st amendment has become a sword in the hands of those who actually want to suppress religious liberty according to their own backers' conception of how it will serve their own private interests. The state has a duty of impartiality to all citizens to spend its judicial resources wisely and flush these idiotic suits over Nativity Scenes down the toilet where they belong... however as Christians we should welcome them as they are the very sort of persecution that separates the sheep from the wolves.

  4. What about the single mothers trying to protect their children from mentally abusive grandparents who hide who they truly are behind mounds and years of medication and have mentally abused their own children to the point of one being in jail and the other was on drugs. What about trying to keep those children from being subjected to the same abuse they were as a child? I can understand in the instance about the parent losing their right and the grandparent having raised the child previously! But not all circumstances grant this being OKAY! some of us parents are trying to protect our children and yes it is our God given right to make those decisions for our children as adults!! This is not just black and white and I will fight every ounce of this to get denied

  5. Mr Smith the theory of Christian persecution in Indiana has been run by the Indiana Supreme Court and soundly rejected there is no such thing according to those who rule over us. it is a thought crime to think otherwise.