Friday, April 21, 2023

When Music Became Tax-Exempt: "First-Class Orchestral Music"

DefaultOn Tuesday, I wrote briefly about when the New York Philharmonic got its tax exemption. Yesterday, I dug back even further to what (may be?) the origins of orchestral tax exemption. In 1919, the Bureau of Internal Revenue issued a ruling (23-19-546 as best I can tell; it's available in 1919-1 C.B. 147) analyzing the deductibility of donations made to orchestras. 

According to the ruling, the orchestra in question was incorporated as a nonprofit corporation under the relevant state law. No part of its income inured to the benefit of a private shareholder or its equivalent. Its mission included "encouraging the performance of first-class orchestral music" and it provided both free concerts and concerts for which it charged admission (though, it said, less admission than other like-quality entertainment). It meant its concerts to "educate the musical taste" of attendees. (Fascinatingly, instead of "attendees" or "audiences," the ruling called them "auditors.") It also provided training to musicians. And, perhaps critically(?), its expenses always exceeded its concert revenue, with the difference made up by donors.

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April 21, 2023 in Music | Permalink | Comments (0)

Thursday, April 20, 2023

When Music Became Tax-Exempt: Jazz

286-MP-fra-08475By the 1960s, rock music had eclipsed the popularity of jazz, and jazz has yet to regain its position as truly popular music in the United States. Sales of jazz account for about 1% of music sales generally (though jazz moves physical copies more than other genres). Why did it get overthrown? The introduction of rock'n'roll in the mid-50s started the job (though some of the bestselling jazz records ever were released or recorded in 1959), and then, by the mid-60s, the Beatles and other British Invasion groups finished what Elvis had begun.

Well, kind of. Jazz was dead, but only if by "dead" you mean "no longer the center of pop music." Frankly, the contemporary jazz scene may be the most vibrant, interesting, and diverse that jazz has ever been.

So how did jazz survive? Interestingly, in 1965--a decade after Elvis signed to RCA and a year after the Beatles invaded the United States--the IRS issued Rev. Rul. 65-271. The Revenue Ruling expressly provided that promoting jazz was an acceptable tax-exempt purpose:

Cultural organizations devoted to the promotion of the arts may qualify for exemption as being educational or charitable in character. See Rev. Ruls. 64-174 and 64-175, C.B. 1964-1 (Part 1), 183 and 185, respectively. By presenting periodic jazz festivals or concerts, as described herein, the organization in question is developing and promoting an appreciation of jazz music as an American art form.

Did tax exemption save jazz? I don't know; I tend to doubt it, but I also know that tax-exempt organizations are critical in the continued viability of the art form. It is interesting, however, to be able to pinpoint the moment when jazz transforms from popular entertainment to an appropriate subject of tax exemption.

Samuel D. Brunson

Photo by U.S. Dept. of State, Agency for International Development. [Festival de Jazz de Cannes].


April 20, 2023 in Music | Permalink | Comments (0)

Monday, April 17, 2023

When Music Became Nonprofit

Sigmund-rMW9us4NCzU-unsplashA lot of my scholarship and personal interests in nonprofit and tax-exempt law revolve around questions of religion (and thanks, Darryll, for highlighting one of those questions today!).

But that's not my only interest! I'm also fascinated by music. And particularly, by music that doesn't have a huge following, like jazz and classical music. And here's the thing--unlike the music my kids enjoy (hi Taylor Swift! how's it going, Måneskin!), jazz and classical music rely heavily on tax-exempt organizations. Orchestras tend to be exempt from tax. So many exempt jazz venues/programs (hi Jazz at Lincoln Center! how's it going, SFJazz?) are too.

So when did music--or at least, non-popular music--become nonprofit? Honestly, I'm not sure. But it's something I want to explore. (It's also something I'm willing to cheat at--if you have an idea when, why, and/or how that move happened, I'd love to hear from you!)

Samuel D. Brunson

Photo by Sigmund on Unsplash

April 17, 2023 in Music | Permalink | Comments (0)

Thursday, February 9, 2023

Opera, Justice, and Nonprofit Support

FofyS1gaMAIIRSqLast night, my family and I went to see "The Factotum," a world-premier opera set in and around a Black barbershop on the South Side of Chicago. (It's actually the second opera we've seen this week--Sunday we saw "Hansel and Gretel.") Inspired by The Barber of Seville, the opera was written by two friends who met at the Governor's School for the Arts in Virginia. It brings to the stage Black voices, Black writers, Black performers, and a facet of the Black experience. Oh, and also musical styles, including hip-hop, barbershop, R&B, gospel, and jazz, without ever sacrificing operatic technique or style.

The writers and the performers definitely have the chops for this--one of the writers/lead characters has starred in "The Barber of Seville" itself, as well as the recent "Fire Shut Up In My Bones" (which I wish I had seen--I love Terrance Blanchard--but alas). His co-writer has moved to DJing, among other things.

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February 9, 2023 in Current Affairs, Music | Permalink | Comments (0)

Friday, September 2, 2022


As a shift from a week of talking about the Newman's Own Foundation: this weekend is the Chicago Jazz Festival. The festival is put on by Chicago's Department of Cultural Affairs and Special Events, and is sponsored, at least in part, by a number of nonprofits, including public radio station WDCB and the Jazz Institute of Chicago.

I think there's an interesting discussion to be had about what it means for jazz (as opposed to pop and rock and hip-hop) to be supported and sponsored by nonprofit organizations. But today I'm not going to engage in the discussion. Instead, I'm heading to Millennium Park to listen to some jazz.

Samuel D. Brunson

September 2, 2022 in Music | Permalink | Comments (0)

Wednesday, April 22, 2020

Novel Coronavirus and the Arts

It's clear that COVID-19 has (temporarily, we hope) devastated whole swaths of the economy. Gyms are closed, airline passengers are down by 95%, movie theaters are sitting empty.

And the pandemic has been devastating to the arts world, a world that quite frequently relies on public performance both to raise revenue and to encourage donors. The novel coronavirus has devastated the jazz world (which is my love), killing jazz legends and shutting down performance spaces.

And then there's dance, an art form perhaps less-well-known and less appreciated than jazz. In Illinois alone, dance companies expect to lose $4.5 million in revenue through April 30, and more if (as is likely) the shutdown lasts longer. Hubbard Street Dance Company, for instance, ended up cancelling the last week of its Decadence tour in Italy in February and then, hours before it opened the performance in Chicago, Gov. Pritzker ordered closed gatherings of more than 1,000 people, closing the performance before it opened.

So how do arts organizations survive? Fortunately, the federal government has provided some help, including the Paycheck Protection Program and $75 million to be distributed by the National Endowment for the Arts.

State and local governments have been stepping up too. Chicago and Illinois have joined together with the Arts for Illinois Relief Fund, which provides grants to artists and arts organizations. The Fund is funded by the city, the state, and private philanthropy (of both the wealthy and the ordinary person type).

Still, the ability of arts organizations to weather this storm, while backstopped by state and philanthropic money, is, at best, tenuous. Once we get past the current crisis, arts organizations may need to rethink their funding models.

In the meantime, while I'm familiar with the steps Chicago and Illinois are taking to protect nonprofit arts organizations, I am less aware of what other cities and states are doing. Does anybody have examples of COVID-19-related support that their city or state is undertaking to protect and shore up the arts?

Samuel D. Brunson

April 22, 2020 in Current Affairs, Federal – Executive, Federal – Legislative, Music, State – Executive | Permalink | Comments (0)

Monday, June 3, 2019

Soccer, Rock Climbing, and Jazz, Oh My!

I'm excited to be here! (Thanks to the Nonprofit Law Prof Blog folks for inviting me!)

Because I wasn't told any differently, I thought I'd take today to briefly introduce myself. I'll get to more substantive blogging tomorrow.

ClimbingI've been teaching at Loyola University Chicago for a decade now. In addition to here, I do some tax blogging at the Surly Subgroup and some religious/Mormon/tax blogging at By Common Consent. I'm broadly interest in tax and nonprofit issues, and am really interested in questions of the taxation of religious stuff.

My outside-of-work time largely consists of two things: shuttling kids to (and sometimes participating in) an insane number of extracurricular activities and listening to jazz. (I'd like it to involve a little more saxophone playing, but you do what you can.) And both of these things implicate tax-exempt organizations and nonprofits, and may provide me with future blogging fodder.

For instance: today after work, I'll take a bus to pick my daughter up from school. Then we'll take the train to First Ascent. I'll climb and work out while she (and my other daughter) practice with their climbing teams. (Side note: did you know that competitive rock climbing was a thing? Me either, until my kids started doing it. But it'll be in the 2020 Olympics.) Competitive rock climbing is governed by USA Climbing, a 501(c)(3) organization.

I also coach my son's soccer team, through AYSO. (My sister is still incredulous, probably rightfully, since I quit soccer when I was 8. Still, I know more than my son and his cohort, and by coaching, I get to choose when we hold practice, which is kind of critical given my family's schedule.) Like USA Climbing, AYSO is a 501(c)(3) exempt organization.

It makes sense, of course: section 501(c)(3) explicitly allows an exemption for organizations that "foster national or international amateur sports competition." I'll admit, though, that I haven't yet carefully thought through this exemption. When I've thought about it, the two organizations that first come to mind are the NCAA and the US Olympic Committee. My suspicion is that both of these organizations are substantially different, though, from USA Climbing and AYSO. I'll be interested in casually exploring the amateur athletics exemption in future posts.

On the jazz front, I've recently become aware of Giant Step Arts, a nonprofit focused on presenting and recording live jazz. I know basically nothing about Giant Step Arts, though several of the projects it has recorded have made for great listening. I plan on looking at it, its mission, and its tax-exempt status (I think, assuming the linked organization is the same as the jazz nonprofit).

Until those posts, though, thanks for having me, and I look forward to my time on this blog!

Samuel D. Brunson

June 3, 2019 in Music, Other, Sports | Permalink | Comments (3)

Monday, June 28, 2010

China Philanthropy Update

·      New philanthropy research institute created.  Wang Zhenyao, the head of China’s first philanthropic research institute, is calling on all Chinese billionaires to donate a million yuan a year to charity.  Wang says multimillionaires should give a hundred thousand yuan annually.  For the past two decades, Wang worked in the Ministry of Civil Affairs.  He is famous in China for his efforts to help victims during the 2008 Sichuan Earthquake.  He has also promoted care for orphans and asked the government for more money for the elderly.  But Wang wants more than government support for China’s poor.  He wants professional, sustainable, private philanthropy to grow.  Now he has left the ministry to head the new Beijing Normal University One Foundation Philanthropy Research Institute full-time.  While Wang has long been a firm believer in the importance of charity, one of his subordinates says that makes him “a rather lonely person” in official circles, according to a 21st Century Business Herald article.  Charity is an emerging field in China, a sign of economic growth and a response to rising inequality.  Traditionally, financial assistance came either from the state or from extended family networks.  The Chinese government has long spoken of “serving the people” and “serving society.” However, China lags behind Western countries in private donations.  The Chinese Civil Affairs Development Report shows that the Ministry received 6.86 billion yuan (just above $1 billion) in donations in 2009, reports a recent China News article.


· The China Charity Donation Information Center in partnership with Shanghai NPO Development Center completed its report on Diaspora Giving to China 2008-2009 as part of APPC’s Diaspora Philanthropy Grants.  The grants provided seed money for specific research activities that lead to making operational databases that will map out the dynamic relationships being cultivated from the giving end to the receiving end.  These grants were awarded to organizations in China, Pakistan, the Philippines and Bangladesh in July 2009 to conduct various database studies on Diaspora giving to home communities, as follow up work to APPC’s 2008 regional conference “Diaspora Giving: An Agent of Change in Asia Pacific Communities?”

Highlights of China Report on Diaspora Giving

· Between 1 January 2008 and 30 June 2009, 24 provinces and municipalities in Mainland China received Diaspora giving valued at RMB 6.7 million from Hong Kong, Macao, Taiwan and overseas Chinese around the world.

· Sichuan province received the most donations due to the Earthquake and snow disaster in early 2008, receiving 37% of the total Diaspora giving to China.

· Second biggest receiver was Beijing, receiving 19.6% of diaspora monies. The city of Beijing houses majority of national charity organization headquarters, such as the China Red Cross Society and China Charity Federation.

· Individuals compose the largest composition of givers followed by overseas Chinese groups and organizations and overseas Chinese enterprises.

· Diaspora funds received in this period were allocated to disaster relief, education, science and sports, poverty alleviation and development.

· Seeing the response of overseas Chinese, provincial and municipal governments passed related overseas donation regulations, which provide policy support and guarantees to further enhance the overseas Chinese donations’ impact.

Email to [email protected] for more information or the full report.



June 28, 2010 in International, Music | Permalink | Comments (0) | TrackBack (0)