Fraternity-Testvériség, 1981 (59. évfolyam, 1-4. szám)
1981-01-01 / 1. szám
In order to qualify for tax exemption, you must operate under thte Lodge System and/or for exclusive benefit of your membership. The I.R.S. states that operating under the Lodge System means “Carry on your activities under a form of organization that is made up of local branches chartered by a parent organization and largely self-governing, called lodges, chapters, etc.” The intention to operate as such is insufficient. An organization is operating under the Lodge System only when the Home Office and Lodges are active — mere provision in your Constitution and By-Laws is not enough — you must show activity. There are no clear rules setting forth any minimum requirements for the number of membership meetings the Lodges and Branches must hold as long as the Lodge System is effectively used as a means of maintaining a representative form of government. In addition, there are no specifications as to the kinds of activities your organization must engage in. In' the 1913 Tax Act, it is stated: “A society or association operating under the lodge system is considered to be an organization under a charter with properly appointed or elected officers, with an adopted ritual or ceremony, holding meetings at stated intervals and supported by fees, dues, or assessments” In 1973 the Internal Revenue issued a revenue ruling in which they discussed the necessary ratio of fraternal activity to Insurance activity requested for tax exemption. In this ruling they stated that there is no requirement for a specific ratio or that either feature dominate so long as both are present in substantial form and neither is a sham. The benefits, as defined by the Internal Revenue Service, are restricted to Life and Sick Benefits and must, he largely part of the objectives of the societies’ exempt purpose. As I have said, you now have another problem. But suppose we turn it around and use it for the positive aspects. Let’s use the I.R.S. Regulations as a selling tool. Each Fraternal has a particular project that you are proud of, such as Youth and Adult Camps, Youth Programs, Senior Citizens’ Homes and Care Centers, etc. Make each Lodge adopt these projects as a central theme for their yearly programming as well. Start publicizing and selling the programs — sell the jewelry of the watch not the time — self your organization not merely insurance — resurrect your lodges and publicize themselves and their programs. Sell the reason for your existence and publicize them — don’t talk about selling —- “Sell.” Make certain that every Lodge, Branch, or Chapter holds elections. If they are of name only — unite them with an active Branch. Increase Home office funding of Branch Programs and Activities. Yes, there are many problems facing the world of fraternalism. You can surmount these obstacles if you are determined, courageous, and hard working. Nobody grows old by merely living a number of years. People grow old by deserting their ideals. You are young as your faith and self-confidence. Pursue your goal faithfully and Fraternalism will prevail. March 12, 1981 Hungarian Reformed Federation of America P O. Box 34917 Washington, D. C. 20034 Gentlemen: This will certify that we have completed a valuation of the certificates of the Hungarian Reformed Federation of America in' force as of December 31, 1980, based on lists furnished us for that purpose and have found the reserves as follows: American Experience 3J/2% ...................$ 1,495,008 American Experience 3% ....................... 2,937,745 1941 Standard Industrial 3% .................... 693,846 American Men Ultimate 3% .................... 9,239,844 1958 CSO 3% .................................... 537,154 1958 CET 3% ..................................... 20,148 P.V. of Payor Death Claims....................... 731 Adjustment for 1st of Month Dating....... 34,500 Adjustment for Premium Waiver at Age 90 15,047 1926-33 Intercompany D.I. with 1941 CSO 2y2% ........................................... 17,589 150% Class (3) with AE 3%, 1941 CSO 2i/2% ................................. 7,267 Class 3, 3% ................................................. 13,811 1952 Disability Table, Per. 2, 3% .......... 15,132 Non-deduction of deferred premiums....... 43,111 Reinsurance Credit ................................... —5,024 $15,065,909 According to the Annual Statement of the Federation at December 31, 1980 other liabilities amounted to $1,343,356. Therefore, total liabilities, including reserves were $16,409,265. The total Admitted Assets of the Federation as of December 31, 1980 were $20,231,392. Therefore, the surplus over all liabilities including reserves was $3,822,126. The ratios of assets to liabilities were: 1980 — 123.29%; 1979 — 121.15%; 1978 — 11907%; 1977 — 112.08%; 1976 — 112.22%. Respectfully submitted, George R Schaumann, MAAA Vice Presiden CPS Actuaries 9
