Viewing page 14 of 19

This transcription has been completed. Contact us with corrections.

- 2 -

This Association made a recent survey of the educational programs of 600 museums - both large and small, located in every state, and representing art, history, and science museums. It was found that they are conducting formally organized classes and lectures for 8,000,000 school children; 4,500,000 adults; 56,000 art students; 14,000 undergraduates registered for college credit museum courses; and 4,000 graduate students engaged in joint museum-university projects in art, history and science. If this sampling were expanded, it would show that over ninety percent of the more than 4,000 museums were providing organized educational programs and facilities for their communities.

Under the provisions of #170(b)(1)(A)(ii) of the Internal Revenue Code of 1954, an "educational organization" is defined, by reference to #503(b)(2), to mean only "an educational organization which normally maintains a regular faculty and curriculum and normally has a regularly enrolled body of pupils or students in attendance at the place where its educational activities are regularly carried on." The Internal Revenue Service has ruled (Rev. Rul. 56-262, 1956-1 C.B. 131, revoking Rev. Rul. 55-219, 1955-1 C.B. 28) that a museum which maintains a regular faculty and regularly enrolled body of students or pupils at the place where its educational activities are carried on is nevertheless not an "educational organization" within the meaning of #170(b)(1)(A)(ii) of the Code. The effect of this interpretation is that individuals who make gifts to museums, historical agencies, and libraries cannot qualify for the extra 10-percent deduction for charitable contributions to "educational organizations."

Museums are heavily dependent upon endowment funds to take care of the major portion of their expenses. Yet the purchasing power of the dollar has