Page:United States Statutes at Large Volume 68A.djvu/203

 CH. 1—NORMAL TAXES AND SURTAXES

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Subchapter F—Exempt Organizations Part I. General rule. Part II. Taxation of business income of certain exempt organizations. Part III- Farmers' cooperatives. Part IV. Shipowners' protection and indemnity associations.

PART I—GENERAL RULE Sec. Sec. Sec. Sec.

501. 502. 503. 504.

Exemption from tax on corporations, certain trusts, etc. Feeder organizations. Requirements for exemption. Denial of exemption.

SEC. 501. EXEMPTION FROM TAX ON CORPORATIONS, CERTAIN TRUSTS, ETC. (a) EXEMPTION FROM TAXATION.—An organization described in

subsection (c) or (d) or section 401(a) shall be exempt from taxation under this subtitle unless such exemption is denied under section 502, 503, or 504. (b) T A X ON UNRELATED BUSINESS INCOME.—An organization exempt from taxation under subsection (a) shall be subject to tax to the extent provided in part II of this subchapter (relating to tax on unrelated income), but, notwithstanding part II, shall be considered an organization exempt from income taxes for the purpose of any law which refers to organizations exempt from income taxes. (c) L I S T OP E X E M P T ORGANIZATIONS.—The following organizations

are referred to in subsection (a): (1) Corporations organized under Act of Congress, if such corporations are instrumentahties of the United States and if, under such Act, as amended and supplemented, such corporations are exempt from Federal income taxes. (2) Corporations organized for the exclusive purpose of holding title to property, collecting income therefrom, and turning over the entire amount thereof, less expenses, to an organization which itself is exempt under this section. (3) Corporations, and any community chest, fund, or foundation, organized and operated exclusively for religious, charitable, scientific, testing for public safety, literary, or educational purposes, or for the prevention of cruelty to children or animals, no part of the net earnings of which inures to the benefit of any private shareholder or individual, no substantial part of the activities of which is carrying on propaganda, or otherwise attempting, to influence legislation, and which does not participate in, or intervene in (including the publishing or distributing of statements), any political campaign on behalf of any candidate for public office. (4) Civic leagues or organizations not organized for profit but operated exclusively for the promotion of social welfare, or local associations of employees, the membership of which is limited to the employees of a designated person or persons in a particular § 501(c)(4)

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