National Water Well Ass'n v. Commissioner
United States Tax Court
P, a trade association for the water well industry, is exempt from taxation as a business league under sec. 501(c)(6), I.R.C. 1954. As the group policyholder of an industry casualty insurance policy, P actively sponsors and promotes that insurance program. Under an agreement with the insurance company, P performs a variety of services for the insurance company and for the insurance brokerage company that manages that insurance program.
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P, a trade association for the water well industry, is exempt from taxation as a business league under sec. 501(c)(6), I.R.C. 1954. As the group policyholder of an industry casualty insurance policy, P actively sponsors and promotes that insurance program. Under an agreement with the insurance company, P performs a variety of services for the insurance company and for the insurance brokerage company that manages that insurance program. During the year in issue, P received a dividend from the insurance company in connection with that insurance program, part of which P distributed to those…
1Opinion of the Court
OPINION
Parker, Judge:
Respondent determined a deficiency in petitioner’s Federal income tax for its fiscal year ended October 31, 1980 in the amount of $21,082. The issues for decision are:(1) Whether insurance dividends received by petitioner, a business league exempt from taxation under section 501(c)(6),1 as the group policyholder of an insurance program that the business league endorsed constitute unrelated business taxable income under section 512; and(2) If so, whether the income is excludable from the unrelated business tax as royalties under section 512(b)(2).
This case was submitted…
2Cases cited25 opinions
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