Discussion Assignment Example | Topics and Well Written Essays - 500 words - 14

Discussion - Assignment Example r to determine the admissibility for tax-exempt status the purpose in the corporate charter must be established, as well as, the way the company operates. Additionally, charitable institutions are exempted from sales and income tax, as well as, Ad valorem property tax. Charitable institutions are defined as institutions that do not have the capital, shareholders or capital stock. Additionally, they dispense help or charity to people who need and to people who apply for it. Charitable institutions do not make any profits or gains in a private sense to any individual who is connected to the institution. For charitable organizations to be exempted under the federal law, the institution must be operated and organized for charitable purposes. Additionally, none of the earnings made by the organization should insure for the purposes of benefiting the individual. For an organization to be exempted from tax the net earnings may not inure to the benefit of any corporation or individual. According to section 501 (c) (3) not all income tax is exempted, for example, in case the charity gets revenue from another business that are not related to charity then they are taxable. Therefore, the lessons I have learned from this module is that charity organizations are made for the benefit of helping people and in case they operate besides their charity work then their income is taxable. Additionally, property that is owned by the federal or state governmental hospitals is exempted from tax. In the case of Provena Covenant Medical Center V Department of Revenue, the medical center applied for tax-exempt status that was based on debt-collection amounts and tactics that the hospital offered. However, the Illinois Department of Revenue denied this application. On Appeal, the Supreme Court further denied the application on tax exemption stating that the Department of Illinois was correct in denying the religious and property tax exemptions because the hospital was charging uninsured