ILNews

Court upholds denial of tax exemptions

Back to TopCommentsE-mailPrintBookmark and Share

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.  

 

ADVERTISEMENT

Post a comment to this story

COMMENTS POLICY
We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
 
You are legally responsible for what you post and your anonymity is not guaranteed.
 
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in Indiana Lawyer editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
 
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
 
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.
 

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by

facebook - twitter on Facebook & Twitter

Indiana State Bar Association

Indianapolis Bar Association

Evansville Bar Association

Allen County Bar Association

Indiana Lawyer on Facebook

facebook
ADVERTISEMENT
Subscribe to Indiana Lawyer
  1. Being dedicated to a genre keeps it alive until the masses catch up to the "trend." Kent and Bill are keepin' it LIVE!! Thank you gentlemen..you know your JAZZ.

  2. Hemp has very little THC which is needed to kill cancer cells! Growing cannabis plants for THC inside a hemp field will not work...where is the fear? From not really knowing about Cannabis and Hemp or just not listening to the people teaching you through testimonies and packets of info over the last few years! Wake up Hoosier law makers!

  3. If our State Government would sue for their rights to grow HEMP like Kentucky did we would not have these issues. AND for your INFORMATION many medical items are also made from HEMP. FOOD, FUEL,FIBER,TEXTILES and MEDICINE are all uses for this plant. South Bend was built on Hemp. Our states antiquated fear of cannabis is embarrassing on the world stage. We really need to lead the way rather than follow. Some day.. we will have freedom in Indiana. And I for one will continue to educate the good folks of this state to the beauty and wonder of this magnificent plant.

  4. Put aside all the marijuana concerns, we are talking about food and fiber uses here. The federal impediments to hemp cultivation are totally ridiculous. Preposterous. Biggest hemp cultivators are China and Europe. We get most of ours from Canada. Hemp is as versatile as any crop ever including corn and soy. It's good the governor laid the way for this, regrettable the buffoons in DC stand in the way. A statutory relic of the failed "war on drugs"

  5. Cannabis is GOOD for our PEOPLE and GOOD for our STATE... 78% would like to see legal access to the product line for better Hoosier Heath. There is a 25% drop in PAIN KILLER Overdoses in states where CANNABIS is legal.

ADVERTISEMENT