Simon v. Eastern Kentucky Welfare Rights Organization

426 U.S. 26 (1976)


In 1969, the IRS issued Revenue Ruling 69-545 that gave insight into section 501 (c)(3), charitable organization deductions. The Ruling stated that a hospital qualified as a charitable deduction even though it did not accept indigents to the extent of its financial ability. A ruling in 1956 No.56-185 required that for a hospital to qualify as a charitable organization, it must accept some patients in need of hospital services who cannot pay for them, and must do so to the extent of its financial ability. Ps challenged the 1969 ruling modifying the 1956 responsibility. Ps alleged specific incidents of deprivation because of their indigence and asserted that the new ruling was contrary to the code in that charitable means relief of the poor. They also claimed that the new rule violated the APA because the ruling did not fall within section 533's exception for interpretative rulemaking