October 7, 1999 | Read Time: 1 minute
The U.S. Tax Court has ruled that the Internal Revenue Service was right to deny charity status to an organization that sponsors an amateur baseball team for adult players.
The group, Wayne Baseball, in Delaware County, Pa., plays home games at a local high school field and does not charge admission to spectators. The organization pays for uniforms, equipment, umpire fees, insurance, league fees, and miscellaneous expenses.
The I.R.S. rejected Wayne Baseball’s application for tax-exempt status because the revenue service said that a substantial portion of the group’s activities was aimed at promoting the “social and recreational” interests of its members, rather than charitable goals.
The Tax Court noted that it had ruled in an earlier case that the “promotion, advancement, and sponsorship of amateur baseball are exempt purposes” under federal law.
But the group under review in that case also leased and maintained baseball fields for the use of local Little League and other teams, and provided coaches for those games — steps that Wayne Baseball does not take.
“Allowing spectators to watch the games free of charge is incidental to the purpose of providing a team for the enjoyment, recreation, and social interaction of the players,” as well as one of the group’s chief contributors — its team manager, the court concluded (Wayne Baseball v. Commissioner of Internal Revenue, T.C. Memo 1999-304).
