You replied: "I know no such thing and in fact would give odds that is not a true statement."

You really should read the Court decision on the Beach Club Parking case.

Ocean Pines Ass'n, Inc. v. Comm'r of Internal Revenue, 672 F.3d 284 | Casetext Search + Citator

Here is a section relative to your claims about how OPA is private:

Section 501(c)(4) provides a tax exemption for “[c]ivic leagues or organizations not organized for profit but operated exclusively for the promotion of social welfare.” 26 U.S.C. § 501(c)(4)(A). Treasury regulations clarify that “[a]n organization is operated exclusively for the promotion of social welfare if it is primarily engaged in promoting in some way the common good and general welfare of the people of the community.” 26 C.F.R. § 1.501(c)(4)–1(a)(2)(i). The regulations add that such an organization is “operated primarily for the purpose of bringing about civic betterments and social improvements.” Id.

Accordingly, we have affirmed denial of a § 501(c)(4) exemption to a private subdivision that limited use of its facilities to individuals who owned property within the development and their guests. Flat Top Lake Ass'n v. United States, 868 F.2d 108, 109–10 (4th Cir.1989). We reasoned that “an organization that operates for the exclusive benefit of its members does not serve a ‘community’ as that term relates to the broader concept of social welfare.” Id. at 111. Because “Congress believed that an organization cannot serve social welfare if it denies its benefits to the general public,” we held that “a true ‘community’ functions within a broader national fabric.”

This is what was published in the Bayside Gazette when OPA gave up:

OCEAN PINES — After years of appeal, the Ocean Pines Association will no longer continue to fight the decision of the United States Tax Court which found the homeowner’s association responsible for taxes related to beach parking income in tax year 2004.
“The OPA has, in consultation with its independent auditors and legal counsel, determined the estimated tax liability to be $340,000 at April 30, 2012,” said Teresa Travatello, marketing and public relations Director of the OPA, in a press release sent last week.
The OPA set aside $450,000 to pay the Internal Revenue Service if the ruling went against it. Included in the total is the roughly $120,000 already paid for taxes owed for fiscal year 2003-2004.

Had the OPA opted to continue its argument, its only route would have been to appeal to the United States Supreme Court. Because of the difficulty to get the Supreme Court to act on tax issues, the OPA declined to pursue the case any farther.
Prior to 2012, parking passes were sold only to OPA members and not the general public. The IRS said the proceeds of those sales, at least for 2004, are taxable.
When notified that back-taxes for 2004 were owed, the OPA apparently did not realize that parking permit revenue was taxable, since it had not been considered ordinary income in previous years.

Why you continue to refuse to recognize the importance and impact of the Court decision is beyond me.