Ocean Pines Assoc. v. Commissioner of IRS

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Ocean Pines Association, a non-stock corporation, oversees a subdivision of more than thirty-five hundred acres in Berlin, Maryland. The Association was exempt from federal income taxation as an organization "not organized for profit but operated exclusively for the promotion of social welfare" pursuant to 26 U.S.C. 501(c)(4)(A). The Tax Court subsequently determined that the net income from two parking lots and a beach club owned by a tax-exempt association constituted "unrelated business taxable income." The association appealed. Because the income derived from the parking lots and beach club was not "substantially related" to the association's tax-exempt purpose, the court affirmed. View "Ocean Pines Assoc. v. Commissioner of IRS" on Justia Law