Supreme Court Update

• Date: 01 July 2020
• Published date: 01 July 2020
• DOI: http://doi.org/10.1002/npc.30746

Bruce R. Hopkins’ NONPROFIT COUNSEL

8 July 2020 THE LAW OF TAX-EXEMP T ORGANIZATIONS MONTHLY

Bruce R. Hopkins’ Nonpr ofit Counsel DOI:10.10 02/n pc

for several days. This includes a “combination of

educational, social, and spiritual activities advancing

the family’s core values of love, unity, and progress.”

The IRS declined to recognize this organization as a

tax-exempt charitable one, finding nonexempt pur-

poses, private inurement, and private benefit (Priv.

Ltr. Rul. 202016022).

• A membership organization of independent opera-

tors in an industry was formed to, among various

objectives, provide education and promote policy to

benefit this industry at the local, state, and national

levels; secure and preserve a “viable livelihood” for

present and future generations; support the finan-

cial, environmental, cultural, and historical interests

of the industry; conduct meetings; and implement

educational programs. It operates a political action

committee. The IRS concluded that this organization

has substantial nonexempt purposes and activities

precluding its exemption as a charitable and educa-

tional entity (Priv. Ltr. Rul. 202016025, and, likewise,

Priv. Ltr. Rul. 202016027).

• A nonprofit organization, with a membership of

independent food truck owners and operators,

applied for recognition of exemption as a charitable

and educational entity. The mission of this organi-

zation is to help its members grow their businesses.

The IRS issued an adverse ruling, holding that a

substantial portion of the organization’s activities is

furtherance of the common business interests of its

members (Priv. Ltr. Rul. 202017034). [4.5(a)]

SUPREME COURT UPDATE

• The US Supreme Court, on May 6, heard arguments in

a case regarding the scope of religious or moral excep-

tions to the contraceptive mandate that is part of the

Patient Protection and Affordable Care Act (Little Sis-

ters of the Poor v. Pennsylvania). The Court, on May

12, heard arguments in two cases that could lead

to expansion of the ministerial exception (see the

March 2012 issue) (Our Lady of Guadalupe School v.

Morrisey-Berru; St. James School v. Darryl Biel).

• The Court, on April 27, held that states cannot cop-

yright their entire state code, including annotations

(Georgia v. Public.Resource.org). The Court, on April

27, held that the federal government is required to

pay insurance companies for the losses they incurred

(approximately $12 billion) in participating in health

care exchanges established in accordance with the

Affordable Care Act (Maine Community Health

Options v. US; Moda Health Plan, Inc. v. US; Land of

Lincoln Mutual Health Ins. Co. v. US).

• Readers will recall the lawsuit seeking to enjoin

enforcement of an IRS notice that identified a trans-

action as a transaction of interest, principally on the

ground that the notice was promulgated in violation

of the Administrative Procedure Act (CIC Services,

LLC v. United States). Both the district court and

the US Court of Appeals for the Sixth Circuit held

that the complaint is barred by the Anti-Injunction

Act (the latter holding summarized in the August

2019 issue). The Court, on May 4, agreed to hear

the case. ◆

OTHER DEVELOPMENT

◆The US Tax Court, on March 24, issued a stipulated

opinion enabling the Panera Bread Foundation to retain

its tax-exempt status (Panera Bread Foundation, Inc. v.

Commissioner). The subject of this case is operation of

the Panera Cares Cafes (petition summarized in the June

2019 issue). The foundation represented to the court

that the cafes have ceased operations and will not be

resumed. [4.9(a), 7.2, 8.1, 24.2(a)] ◆

Each article in the newsletter on a tax-exempt organizations law topic ends with a citation to the appropriate chapter(s) or

subchapter(s) in Hopkins, The Law of Tax-Exempt Organizations, Twelfth Edition (Wiley, 2019, 2020 supplement). This is done to

provide ready access to additional and background information concerning these articles. For example, underlying information con-

cerning the first article in this issue is available in Chapter 25 § 5 of the book; thus, the citation is referenced as [25.5]. Likewise,

each article in the newsletter on a charitable giving law topic ends with a citation to the appropriate chapter(s) or subchapter(s) in

Hopkins, The Tax Law of Charitable Giving, Fifth Edition (Wiley, 2014, 2020 cumulative supplement). For example, underlying infor-

mation concerning the fourth article in this issue is available in Chapter 9 § 7 of the book; thus, the citation is referenced as [9.7].

This newsletter is a stand-alone publication. An inventory of articles in the newsletter since its inception in 1983, and a subject

matter index, as well as an index of the court opinions, IRS revenue rulings and procedures, IRS technical advice memoranda, and

IRS private letter rulings discussed in the newsletter, are available at www.brucerhopkinslaw.com. For those who have the books,

the newsletter also provides monthly updates. Both books are annually supplemented. Questions concerning nonprofit law devel-

opments in general may be sent to brucerhopkins@brucerhopkinslaw.com. Also, a comprehensive summary of nonprofit law is

available in the Bruce R. Hopkins Nonprofit Law Library, an e-book published by Wiley. Other law resources are referenced at www.

brucerhopkinsbooks.com. Follow BRHopkins_NPLaw on Twitter.

The newsletter has a dedicated website. Please visit wileyonlinelibrary.com/journal/npc.

Quote of the Month: This from the government’s reply

brief, filed on May 7, in the Mayo Clinic case (see the

October 2019 and June 2020 issues): Mayo’s “real com-

plaint is that Congress opted to extend the limited tax

exemption in § 514(c)(9)(C) to § 170(b)(1)(A)(ii) only and

not to § 170(b)(1)(A)(iii).”