Zeta Beta Tau Fraternity, Inc. v. Commissioner
United States Tax Court
Petitioner is a national college fraternity and is classified by respondent as a tax-exempt social club under sec. 501(c)(7), I.R.C. 1954. Held: Petitioner does not also qualify as a domestic fraternal organization under sec. 501(c)(10), I.R.C. 1954. Therefore, petitioner's unrelated business taxable income includes income from investments under sec. 512(a)(3)(A), I.R.C. 1954. Held, further, sec. 1.501(c)(10)-1, Income Tax Regs., is valid.
1Opinion of the Court
SWIFT, Judge:
In a timely statutory notice of deficiency respondent determined a deficiency in the unrelated business income tax of petitioner for its taxable year ending June 30, 1971, in the amount of $1,936. The only issue for decision is whether petitioner, a tax-exempt social club described in section 501(c)(7),1 also qualifies as a tax-exempt domestic fraternal society described in section 501(c)(10). If so, petitioner’s income from investments is not taxable as unrelated business income and petitioner is not liable for an underpayment of tax.
FINDINGS OF FACT
This case was submitted fully…
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- J. C. Penney Company, Transferee v. Commissioner of Internal RevenueCourt of Appeals for the Second Circuit · 1962
- McGlotten v. ConnallyDistrict Court, District of Columbia · 1972
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