coast guard morale, welfare, recreation manual - DOT On-Line ...

6-J. Taxes.
1. Legal Status. A morale fund is an instrumentality of the
Federal Government. As such it is exempt under the
Constitution and Federal Statutes from certain
taxingauthorities. These immunities are included in the
discussion below. Morale Funds should be administered to
take advantage of these exemptions.
2. Federal Taxes Applicable. The MWR officer shall obtain
annually a copy of the Employer's Tax Guide, Circular E
from the District Director of Internal Revenue and shall
comply with its provisions. Employees of MWR activities
are subject to Federal Tax Payment and Withholding
Provisions.
.3. Federal Taxes not Applicable.
a. MWR functions and profits are exempt from the
provisions of the Internal Revenue Code. Returns for
Federal income taxes need not be filed.
b. MWR activities are exempt from payment of the Federal
Communication Tax on the following types of
communications:
C. (1) Long distance telephone or radio telephone
messages.
Domestic telegraph, cable, or radio dispatch
messages. No certificate of exemption is
necessary to establish exemption from the tax on
amounts paid directly for telegraph, telephone,
radio, and cable services or facilities. A MWR
activity may note on any bill submitted that it
is an instrumentality of the United States.
This exemption applies only to official calls
and services and does not apply to personal
calls made through the facilities of the .
activity.
4. Communications with Federal Authorities. The initiation
of inquiries or replies to Federal authorities regarding
taxation and regulations affecting MWR functions and/or
unit morale funds shall be cleared via chain of command
with Commandant (G-PXM) before any action is taken.
5. State and Local Tax. Instrumentalities of the United
States Government are not subject to direct taxation by
State or local taxing authorities, except when authorized
by Federal statute. Inquiries or replies to State or
local officials on matters pertaining to taxation shall
be cleared via chain of command with Commandant (G-PXM).
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