Kaiser Aluminum & Chemical Corp. and Kaiser Alumina Australia Corp.

325

Richardson Investments, Inc. & Subsidiaries (formerly known as Rich

REPORTS

OF THE

UNITED STATES TAX COURT

CHURCH OF THE TRANSFIGURING SPIRIT, INC., PETITIONER V. COMMISSIONER OF INTERNAL REVENUE, RESPONDENT

Where virtually all of the income of petitioner, a religious
organization, was contributed by two of its ministers, virtually all
of such income was paid as housing allowances for the benefit of
those ministers, and virtually all of the control of petitioner was in
those ministers. Held, respondent's determination that petitioner
is not an organization described in sec. 501(c)(3), I.R.C. 1954,
sustained.

G. David Thayer (an officer), for the petitioner.
Deborah A. Butler, for the respondent.

OPINION

EKMAN, Judge: This is an action for declaratory judgment pursuant to section 7428.1 The case was submitted on a stipulated record under Rule 122, Tax Court Rules of Practice and Procedure,2 and the stipulated record is incorporated herein by this reference.

'The prerequisites for declaratory judgment have been met: petitioner is the organization whose qualification is at issue, sec. 7428(b)(1); petitioner exhausted all its administrative remedies, sec. 7428(b)(2); petitioner timely filed its petition, sec. 7428(b)(3).

"After the administrative record was submitted and stipulated, petitioner made a motion to correct alleged errors in its figures. The motion is denied. See Houston Lawyer Referral Service, Inc v. Commissioner, 69 T.C. 570 (1980).

1

Petitioner, the Church of the Transfiguring Spirit, Inc., was incorporated on January 8, 1979, under the Non-Profit Corporation Act of New Mexico. Its principal office at the time of filing its petition was in New Mexico. The petitioner originally filed for exemption under section 501(c)(3) on February 27, 1979. Respondent issued his final adverse determination on December 19, 1979. Based upon the documents submitted by petitioner, respondent determined that (1) petitioner had net earnings inuring to the benefit of G. David Thayer (hereinafter Mr. Thayer) and Retta M. Thayer (hereinafter Mrs. Thayer), and (2) petitioner was operated for the private purpose of Mr. and Mrs. Thayer.

Petitioner was first formed as an association on August 30, 1977. A church charter was issued to petitioner from Mother Earth Church, Inc., on November 11, 1977.

Petitioner states in its articles of incorporation that its primary purpose is to operate a church for religious purposes. Its articles of incorporation further state that no power shall be exercised that will violate its exemption under section 501(c)(3); that upon dissolution, its assets may be transferred to any organization exempt from tax under section 501(c)(3); that no part of its net income or assets shall inure to the benefit of any private individual or director; and that no substantial part of its activities shall consist of carrying on propaganda or otherwise attempting to influence legislation.

A booklet entitled "Church of the Transfiguring Spirit" sets out in detail the origins, missions, resources, disciplines, and many other aspects of the Church. A three page document entitled "Article of Faith" further amplifies petitioner's belief. Petitioner has also circulated throughout Las Cruces, N. Mex., a flyer entitled "Do You Want the World to Stop So You Can Get Off?" In its booklet, petitioner described its mission as:

the liberation, the salvation, the transfiguration of all of its members. We seek to help you find your true Self in union with God. Union with God is True Life: all else is garbage.

The mission has two aspects. The first is to provide a nuturing community that will speed the progress of each member to ultimate union with God.

The second aspect of our mission is to develop effective apostles to spread the Word throughout the land and all the world. *