After paying a portion of such taxes for certain years, Goldsboro filed a refund suit in Federal District Court, and the IRS counterclaimed for unpaid taxes. (a) An examination of the IRC's framework and the background of congressional purposes reveals unmistakable evidence that underlying all relevant parts of the IRC is the intent that entitlement to tax exemption depends on meeting certain common-law standards of charity - namely, that an institution seeking tax-exempt status must serve a public purpose and not be contrary to established public policy. (b) The IRS's 1970 interpretation of 501(c)(3) was correct. The District Court entered summary judgment for the IRS, rejecting Goldsboro's claim to tax-exempt status under 501(c) (3) and also its claim that the denial of such status violated the Religion Clauses of the First Amendment. Held: Neither petitioner qualifies as a tax-exempt organization under 501(c)(3). Thus, to warrant exemption under 501(c)(3), an institution must fall within a category specified in that section and must demonstrably serve and be in harmony with the public interest, and the institution's purpose must not be so at odds with the common community conscience as to undermine any public benefit that might otherwise be conferred. It would be wholly incompatible with the concepts underlying tax exemption to grant tax-exempt status to racially discriminatory private educational entities. Bob Jones III, president of Bob Jones University, wrote a formal press release in support of his college.It reads like a used car salesman’s pitch -- Bob Jones manages to alienate half of the people in his speech whom he so desperately needs to convince to support his college. United States, also on certiorari to the same court. organized and operated exclusively for religious, charitable . Until 1970, the Internal Revenue Service (IRS) granted tax-exempt status under 501(c)(3) to private schools, independent of racial admissions policies, and granted charitable deductions for contributions to such schools under 170 of the IRC. or educational purposes" are entitled to tax exemption. With him on the briefs were Acting Solicitor General Wallace and Deputy Assistant Attorney General Cooper. Coleman, Jr., pro se, by invitation of the Court, 456 U. 922 , argued the cause as amicus curiae urging affirmance. Rehearing and Rehearing En Banc Denied April 8, 1981. The admissions and disciplinary policies used to enforce this belief have resulted in the loss of the University's tax exempt status, which we are now asked to review. It is a religious institution in its own right, as well as an educational one. Mc Knew, Leatherwood, Walker, Todd & Mann, Greenville, S. Stophel, Stophel, Caldwell & Heggie, Chattanooga, Tenn., on brief) for appellee. HALL, Circuit Judge: Bob Jones University conducts "an institution of learning for the general education of youth in the essentials of culture and in the arts and sciences, giving special emphasis to the Christian religion and the ethics revealed in the Holy Scriptures...." religious teachings include a strict prohibition against interracial dating and marriage. Taxpayer is not affiliated with any religious denomination, but maintains a fundamentalist orientation in its educational approach. There is to be no interracial dating Prior to 1970, the Internal Revenue Service extended tax exempt status under § 501(c)(3) of the Internal Revenue Code, 26 U. In 1970, however, black Mississippi parents and children obtained a preliminary injunction prohibiting the IRS, pendente lite, from according tax-exempt status to private schools in Mississippi which discriminated on the basis of race.
In states without same-sex marriage rights, many colleges have offered or tried to offer domestic partner benefits (which some state governments by legislation or political influence have blocked at public institutions). Michael BLUMENTHAL, Secretary of the Treasury and Jerome Kurtz, Commissioner of Internal Revenue, Appellants. Bob Jones University believes that the Scriptures forbid interracial marriage and dating. From 1971 to May, 1975, taxpayer accepted no applications from unmarried black students, with the exception, since 1973, of staff members who had been at the University four years or longer. Bob Jones University of Greenville, South Carolina, issued an online statement Thursday apologizing for "racially hurtful" practices of its past, including prohibiting married African American students until 1971 and unmarried African American students until 1975, and banning interracial dating until 2000.The letter stated that BJU's former policies were "shaped more directly by that [segregationist] ethos than by the principles and precepts of the Scriptures." "In so doing," the letter said, "we failed to accurately represent the Lord and to fulfill the commandment to love others as ourselves.Colleges that were not comfortable offering health insurance to employees when not all employees could get marital or family coverage no longer face that prospect, as everyone has equal marriage rights.