Sandhill - IRS Correspondence - Answer IRS questions

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Tags: IRS, Overview, Tax Info Package

Tax Information Package - SH-TXP2 - IRS Correspondence - Answer IRS questions

Tax Information Package - SH-TXP2

Written statement addressing the points raised
in Rev. Proc. 72-5, section 3--.01(5)

a) Sandhill Farm is an intentional community guided by the seven principles set forth in the articles of incorporation (copy enclosed in this submission). Its purpose is to create and maintain a healthy, growthful environment for its members and to promote the advantages of this lifestyle so that others might be aware of such a choice.

In the organization's early years the focus has been on the development of the physical facilities and creation of a social atmosphere conducive to physiological and spiritual well-being. The exact nature of activities depends on the make-up of the membership at any given time, making it difficult to predict with accuracy future activities. Nonetheless, it can be generally said that we expect to become more involved with outreach to the outside community as we try to make available our experiences with our way of life.

Sandhill Farm is striving to become income self-sufficient and toward that end is farming some of its agricultural land for cash income and has developed a modest sorghum molasses business in the northeast Missouri area. This past year we bought several beehives and are hopeful of establishing a honey business as well.

Sandhill Farm makes its home open to visitors interested in community and is an active member of the Federation of Egalitarian Communities.

b) Sandhill Farm maintains a common treasury, and the money earned by members' efforts all goes into that treasury.

c) The real property and all structures of the community are owned in common. Each adult is entitled to co's own room, but all other facilities are jointly controlled. At present all bedrooms are in just two buildings, with a third for this purpose under construction. Among other things the community maintains communal facilities for cooking and dining. And, in particular, the evening meal is a central focus of the communal day; our group tries to center itself before this meal by joining hands together in a circle of silence prior to eating.

d) Provisional and child members are not required to give up ownership of any real or personal property upon becoming provisional members. However, they are generally expected to make the use of such property available to the group, and any income derived from this property is considered group income and goes into the common treasury (with the exceptions noted in Article II, Paragraph 2, of the bylaws).

e) Sandhill assumes responsibility for providing for all of a member's basic needs, including food, clothing, shelter, medical expenses, and education.

f) There are three classes of members: provisional, full, and child. To become a provisional member, a prospective must first visit Sandhill, preferably for at least 10-14 days. If it appears possible that the prospective might join, co is then encouraged to leave the community for a time, during which both the current population and the prospective are given the chance to further contemplate the possibility of the individual joining. If everyone is agreed, the prospective becomes a provisional member.

A prospective must agree to abide by our seven guiding principles, but acceptance as a member also depends to a large extent on a subjective evaluation of the prospective's compatibility with the community's present membership. The sense of group or community is essential to the group's ability to create and maintain the healthy, growthful, trusting environment it strives for, and we have found it necessary to look beyond a matching of values and ideals to examine a prospective's social skills and emotional maturity.

In general, provisional members have rights equal to those of full members.

Child members may become provisional members at the joint discretion of the adult members and the individual child in question. Until becoming a provisional member a child member is not expected to contribute as much as adults toward group work, nor is co guaranteed an equal voice in community decision-making.

Once property is donated, the group is not obligated for any compensation in the event of the donating individual's deciding to leave the community. Because of this, when a person first becomes a provisional member, co is discouraged from donating property. (It has been our experience that during their first year at Sandhill many provisional members discover that for one reason or another this community is not the situation best suited for them and they decide to leave.)

If and when a provisional member feels ready, and the rest of the community agrees, co may become a full member. This entails donating all of one's real and personal property to the community. Should a full member subsequently decide to leave the community, Sandhill would provide a modest $100 leaving fund to aid in transisting to another living situation, but the ex-full member would have no other claim to community assets.