An important message about the HCCA and the IRS
by Richard Cutler 2011 HCCA President
November 28, 2011

        (Previously posted)
As has been touched upon in the Horseless Carriage Gazette and meetings, the HCCA is having difficulties with the IRS. Since changes in the status are happening quickly, the web site seems to be the best way to keep you up to date. There is much detail. I can only give a brief summary here.

        In 2006 the Horseless Carriage Club applied for a 501(c)(3) not for profit status that would allow donations to the HCCA to be tax deductable. Prior to that the HCCA had the potential of at least two major gifts that went elsewhere because we did not have the tax deductable status. In 2007 the IRS granted us that status.

        In 2010, the IRS decided to perform an audit on the HCCA. During the process, the IRS agent determined that the HCCA wasn`t living up to the definition of "charity" for the public benefit. In our case that is education.

        While the HCCA has been doing everything it said it would do in the original application, the agent disagreed. Frank Hurley, our president in 2010, and his team put together as much proof as possible that we are living up to our educational mission to the public and not just within the confines of HCCA membership. This was not enough.

        In May of 2011, we received notification that our 501(c)(3) status was being revoked. We had 30 days to submit an appeal, which we have done. We understand that this appeal process will take some time. Time we are using to organize a multi-pronged defense.

        When an organization with a 501(c)(3) status goes out of business, ALL assets must be turned over to another 501(c)(3) organization that has a similarly approved mission.

        With the revocation of the 501(c)(3), the HCCA is essentially put out of business. This is obviously completely unacceptable.

        I will keep you up to date as there is "breaking news", and there will be some additional explanation in the Horseless Carriage Gazette. In the mean time, I feel we have a good game plan and with the assistance of our attorneys we will be developing a detailed approach to a hopefully satisfactory negotiated settlement. Your HCCA Board is not sitting back. This issue is foremost in everyone`s mind.

July 18, 2011 Update:
        We have not heard from the IRS as to who the appeal agent will be assigned to our case. Our current thinking is that we might have a hearing this coming December, but we simply don`t know.   In the mean time, the HCCA will continue to function with no changes to our operation or in our longer-range plans. We are not out of business. Tours are being scheduled, the 2012 budget is being prepared, the 2012 annual meeting and convention is scheduled for February and our very special 75th birthday party will be held in Colorado Springs over the 4th of July.

September 29, 2011 Update:
        We still do not know who the appeal agent is or the schedule. In a letter of response to the HCCA appeal letter from the original agent, there is a strong hint that we are still seen as a 501(c)(7) not for profit "association" club. Of course we think we are as well. Not waiting for our appeal to be heard and then scrambling, we are moving forward on two fronts. One is to set up a new 501(c)(3) organization to deal with education exclusively and a "new club". This is a little complicated.

        Think of the HCCA as being made to go away by the IRS. So we reinvent ourselves in the mean time. As a place-holder we`re seeing if "Horseless Carriage Club International" is a name we can use. If we can, we`re going to file all the papers we need to set that up with the same rules, by-laws etc. as the current HCCA. This gives us an option if the negotiations with the IRS don`t go well.

        Eventually we could maintain the new name or go back and see if the HCCA name is available (which it should be!) and then change our name back. There are options being considered as well, but are not at all developed. If your head is spinning, welcome to this new aspect of the club.

        As said before, we`re still in business and we`re doing all we can to keep the HCCA interesting and growing.

November 28, 2011 Update:

We have just learned who our IRS Appeals Agent will be. That will now allow us to talk to someone and get a discussion scheduled.
Wish us luck!