Ocean Pines Ass'n v. Commissioner
United States Tax Court
P, a homeowners association exempt from tax under sec. 501(c)(4), I.R.C., operated two parking lots and a beach club eight miles from the area in which its members lived. The parking lots and the primary beach club facilities were accessible only to the association's members and their guests.
Read the full summary
P, a homeowners association exempt from tax under sec. 501(c)(4), I.R.C., operated two parking lots and a beach club eight miles from the area in which its members lived. The parking lots and the primary beach club facilities were accessible only to the association's members and their guests. The association did not report its net income from the parking lot and beach club activities as unrelated business taxable income on its tax returns for 2003 and 2004. R issued a notice of deficiency determining that the net income was subject to the unrelated business income tax because the operation of…
1Opinion of the Court
OPINION
Morrison, Judge:
On November 29, 2007, respondent Commissioner of Internal Revenue mailed a notice of deficiency for the taxable years 2003 and 2004 to petitioner Ocean Pines Association, Inc. We refer to respondent as the IRS. We refer to petitioner as the Association. In the notice, the IRS determined the following deficiencies in income tax and additions to tax under section 6651(a)(1):
Addition to tax Year Deficiency sec. 6651(a)(1)
$65,929 $16,482 to © o w
94,195 23,549 to o © ^
After concessions, the issues remaining for decision are: (1) whether the Association’s operation of a beach…
2Cases cited5 opinions
- Welch v. HelveringSupreme Court of the United States · 1933
- Professional Insurance Agents of Michigan v. Commissioner of Internal RevenueCourt of Appeals for the Sixth Circuit · 1984
- Professional Ins. Agents v. CommissionerUnited States Tax Court · 1982
- Kentucky Bar Foundation, Inc., etc. v. CommissionerUnited States Tax Court · 1982
- Flat Top Lake Association, Inc. v. United StatesCourt of Appeals for the Fourth Circuit · 1989