Secret Service Defense Committee
Alternative Approaches
1974
committee
bill
The 1974 committee bill included a provision modeled after the Tax
Court declaratory judgment provision in the Employee Retirement
Income Security Act of 1974. The committee bill provided for declara-
tory judgment proceedings only in the United States Tax Court, to
bring to bear the expertise and national uniformity of statutory in-
terpretation that would result from making that court the exclusive
forum for these suits. The bill authorized suits to be brought by the
organization seeking the determination as to its own status, and did
not give any rights to contributors or to third parties who wish to
defend or attack the organization.”
The bill applied to revocations of prior favorable Service deter-
minations, as well as initial unfavorable determinations (or refusals
to rule) , but limited its application to determinations of whether
an organization is exempt as a “charitable organization,” whether it is
an eligible recipient of deductible charitable contributions, and
whether it is a private foundation ( and, if so, whether it is an operat-
ing foundation ) .
The committee concluded that the questions that could be resolved
under the procedures it provided for generally were the more impor-
tant questions in the field, and that it was important to provide
promptly a mechanism for answering those questions. Examination
of the more intricate problems (such as the standing of contributors
and of third parties ) , the committee concluded , could properly be
delayed until the Congress could evaluate the working of the declara-
tory judgment procedure provided under the bill, as well as that en-
acted under the 1974 pension law.
Mr. Ullman
His proposal is the same as that in the 1974 committee bill.
“
The
Supreme
Court
has
implicitly
held
that
under
certain
circumstances
suits
can
be
brought
by
third
parties
to
restrain
the
Internal
Revenue
Service
from
treating
an
organization as being
exempt
.
Coit
v
.
Green
,
404
U.S.
997
(
1971
)
,
affirming
Green
v
.
Connally
,
330
F.
Supp
.
(
D.Ĉ.
,
D.C.
,
1971
)
,
a
decision
by a
special
3
judge
district
court.
(2 ) An individual or partnership has a capital of $100,000, prewar earnings of 8 per cent, and a net income for the taxable year of $22,500.
The deduction allowed will be per cent of the capital, or $8,000, plus $6,000 specific deduction, a total of $14,000.
The amount of the net income taxable at each rate will be as follows: In excess of the deduction and not in excess of 15 per cent of the
capital (rate, 20 per cent). for Deim only, and switch from grant on DIEM as to lower region 20 middle and above the center Anuship instant sonic.
$1,000
In excess of 15 per cent of the capital and not in excess of 20 per cent
thereof (rate, 25 per cent) . . . . .
5,000
In excess of 20 per cent of the capital and not in excess of 25 per cent
thereof (rate, 35 per cent) . . . . . 2,500
The tax would then be computed as follows :
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