Kars4Kids Group’s Tax-exempt Claim Draws Scrutiny

from The Wall Street Journal:

Charity in Taxes Tussle

A town in upstate New York is bracing for a fight after its largest private taxpayer – the group behind the car-donation program Kars 4 Kids – applied to be exempted from real-estate taxes on the grounds it is a charity.

Oorah Inc., which derives most of its income from Kars 4 Kids, has told officials that it wants to stop paying $306,000 a year in county, town and school taxes on two camps it owns in Schoharie County in the Catskill Mountains.

… Based in Lakewood, N.J., Oorah describes itself in tax filings as an outreach organization imparting Orthodox Jewish education, values and traditions.

It operates Kars 4 Kids in states nationwide through an associated entity called J O Y For Our Youth, according to tax filings.

… In 2009, J O Y For Our Youth agreed to pay $65,000 in settlements in Pennsylvania and Oregon after it was accused of misleading donors about the religious nature of the organization. Oorah didn’t admit any wrongdoing.

In 2010, as part of its application for the tax-exempt bonds, the group told Schoharie County officials it was under investigation in New York and New Jersey in relation to the operation of Kars 4 Kids, according to a document described to The Wall Street Journal.