Read the opinion: Beaver Dam Community Hospitals, Inc. v. City of Beaver Dam
Wisconsin law generally exempts property owned and used exclusively by (among other things) a nonprofit entity that is operated as a facility that is licensed, certified, or registered under Wisconsin Statutes Chapter 50, including benevolent nursing homes. Chapter 50 generally regulates hospitals, hospices, nursing homes, and certain other facilities, including community-based residential facilities, in Wisconsin.
The City of Beaver Dam argued that the law applies only to facilities that show benevolent use. “Benevolent” activities have been defined for this purpose as those that benefit the public and, to some extent at least, relieve the state from expense. The city argued that the exemption does not apply to Beaver Dam Community Hospital's residential facility because the hospital charges market rates for the use of the facility.
The Wisconsin Court of Appeals held the statutory language “including benevolent nursing homes” means the same thing as “including, but not limited to, benevolent nursing homes.” The appeals court held that the law exempts from tax a facility that is licensed, certified, or registered under Chapter 50, whether or not the facility is “benevolent.”
For more information, contact:
Rick Speizman, National Partner-In-Charge, KPMG’s Exempt Organizations Tax Practice (ExoTax)