Finance chairman targets museums

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Senate Finance Committee Chairman Orrin Hatch (R-Utah) has sent letters to 11 private museums and foundations asking them for information relating to their tax-exempt statuses.

The Supreme Court has said that nonprofits granted status as a 501(c)(3) tax-exempt organization have to serve the public interest.

{mosads}The letters come after reports raised the possibility that some private foundations are operating museums with little public benefit. “Such an arrangement would be inconsistent with the letter and intent of the 501(c)(3) tax exemption,” Hatch wrote.

Hatch asked the museums to provide several pieces of information in order to get a better sense of how museums operated by private foundations work. The information requested includes: the forms submitted to the Internal Revenue Service when the museums applied for tax-exempt status, data about the museums’ operating schedules and number of visitors, and the museums’ policies on accepting restricted gifts.

The entities— which include the Kreeger Museum in Washington, D.C. and the Brant Foundation in Greenwich, Conn. — should provide their responses to the finance committee by Dec. 15, Hatch wrote.

The New York Times first reported about the letters.

“Tax-exempt museums should focus on providing a public good and not the art of skirting around the tax code,” Hatch told the Times. “While more information is needed to ensure compliance with the tax code, one thing is clear: under the law, these organizations have a duty to promote the public interest, not those of well-off benefactors, plain and simple.”


Tags 501(c) organization Charity law Nonprofit organization Orrin Hatch

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