Line 12. Organization Meeting the Section 509(a)(2) Public Support Tests.    Check the box on line 12 and complete the Support Schedule to determine whether an organization meets both of the following section 509(a)(2) support tests:

1. The organization normally receives more than one-third of its support for each tax year from:
   • Persons other than disqualified persons (see Part IV, Definitions) with respect to the organization,
   • Governmental units (described in section 170(c)(1)), or
   • Organizations described in section 170(b)(1)(A) (other than in clauses (vii) and (viii)), and

   Such support is received by the organization from any combination of:

   • Gifts, grants, contributions, or membership fees, and
   • Gross receipts from admissions, sales of merchandise, performance of services, or furnishing of facilities, in an activity that is not an unrelated trade or business (within the meaning of section 513).

   Gross receipts, in any tax year, do not include receipts from any person, bureau, or similar agency of a government unit (described in section 170(c)(1)) to the extent such receipts exceed the greater of $5,000 or 1% of the organization's support in such tax year.

2. The organization normally receives not more than one-third of its support each tax year from the sum of:
   • Gross investment income (as defined in section 509(e)), and
   • The excess (if any) of the amount of the unrelated business taxable income (as defined in section 512) over the amount of the tax imposed by section 511.

Gross investment income.   When determining whether an organization meets the gross investment income test of section 509(a)(2)(B), amounts received from the following organizations retain the character of gross investment income (rather than gifts or contributions) to the extent that these organizations characterize the amounts as gross investment income:

• An organization that claims to be described in section 509(a)(3) because it supports a section 509(a)(2) organization; or
• A charitable trust, corporation, fund, or association described in section 501(c)(3) (including a nonexempt charitable trust described in section 4947(a)(1)), that is required to distribute, or normally distributes, at least 25% of its adjusted net income (within the meaning of section 4942(f)) to a section 509(a)(2) organization, if the distribution normally comprises at least 5% of the distributee organization's adjusted net income.

If an organization receives an amount from a split-interest trust described in section 4947(a)(2) that is required to distribute, or normally distributes, at least 25% of its adjusted net income to a section 509(a)(2) organization, and the distribution normally comprises at least 5% of the distributee organization's adjusted net income, the amount retains the character of gross investment income if it would be characterized as gross investment income attributable to transfers in trust after May 26, 1969, if the trust were a private foundation.

All income characterized as gross investment income in the possession of the distributing organization is considered to be distributed first by the organization and keeps its character as such in the possession of the recipient.

For more details, see Regulations section 1.509(a)-5 that covers special rules of attribution.

If the organization received any amounts from either kind of organization above, attach a statement. Show the amounts received from each organization, including amounts, such as gifts, that are not investment income.

Example.   T organization reported the following amounts in its Support Schedule for the 4-year period 1998 through 2001:

Line		(e) Total
15	Gifts, grants & contributions	$45,000
16	Membership fees	50,000
17	Gross receipts from admissions, merchandise, etc.	25,000
18	Gross income from interest, dividends, etc.	80,000
23	Total of lines 15 through 22	$200,000
27a	Gifts from disqualified persons	$25,000
b	Excess gross receipts from nondisqualified persons	$20,000

T organization determined whether or not it met the one-third tests of section 509(a)(2) in the following computation:

Section 509(a)(2) computation:
Line
27c	Add: Amounts from column (e), lines 15, 16, 17, 20, and 21		$120,000
27d	Total of line 27a	$25,000
	Total of line 27b	20,000	45,000
27e	Public support (line 27c minus line 27d total)		$75,000
27f	Total support (line 23, column (e))	$200,000
27g	Public support percentage (line 27e divided by line 27f - $75,000/$200,000)		37.50%
27h	Investment income percentage (line 18 divided by line 27f - $80,000/$200,000)		40.0%

T organization received 37.50% of its total support from the public and thus met the more-than-one-third test of public support to total support. T organization's investment income percentage was 40.0%. Therefore, it did not meet the second part of the section 509(a)(2) test - the not-more-than-one-third of total support from gross investment income and net unrelated business taxable income.

Since T organization did not satisfy both of the one-third tests of section 509(a)(2), it failed the section 509(a)(2) public support test for this year. An organization that fails the public support test for 2 consecutive years loses its public charity status and becomes a private foundation.

Line 13. Supporting Organization.   Check the box on line 13 and complete columns (a) and (b) for a supporting organization operated only for the benefit of and in connection with organizations listed in lines 5 through 12, or with organizations described in section 501(c)(4), (5), or (6) that meet the tests of section 509(a)(2) (described in line 12). General principles governing supporting organizations are described in Regulations section 1.509(a)-4.

For column (b), identify the organization supported if it is included in lines 5 through 12. For example, if your organization supported a hospital, enter 7 in column (b).

Line 14. Organization Operated to Test for Public Safety.   Check the box on line 14 only if the organization has received a ruling from the IRS that it is organized and operated primarily to test for public safety.

Part IV-A - Support Schedule

Complete the Support Schedule if a box on line 10, 11, or 12 was checked.

Note:   The Support Schedule must be completed on the cash method of accounting.

For example, if a grantor makes a grant to an organization payable over a term of years, such grant will be includible in the support fraction of the grantee organization only when and to the extent amounts payable under the grant are received by the grantee.

If the organization uses the accrual method of accounting, a worksheet such as the one that follows may be used to convert any revenue account from an accrual basis to a cash basis.

Worksheet to convert a revenue account from the accrual to the cash basis

1.	Revenue per books (accrual basis)
2. a.	Add: Beginning-of-year entry (if any) reversing accrual of income at the end of the prior year; and
b.	Any amounts collected during the year that were not credited to the revenue account in the current year
3.	Subtotal
4.	Less: Income accrued during the current year but not collected as of the end of the year
5.	Revenue on a cash basis

If the organization has not existed during the whole period the Support Schedule covers, fill in the information for the years that apply. If the organization's status is based on years not shown in the Support Schedule, attach an additional schedule for the other years.

Lines 15, 16, 17, 26, and 27.   See Part IV, Definitions. See also Regulations section 1.509(a)-3 for the:

1. Distinction between gross receipts from gifts and contributions, grants, and gross investment income, and
2. Definition of membership fees and a bureau or similar agency of a governmental unit.

Note:   Organizations completing line 26 should note the instructions and examples for lines 10 or 11 regarding the public support test applicable to their type of organization.

Organizations completing line 27 should note the instructions and examples for line 12 for guidance in computing their public support test.

Line 17. Gross Receipts From Activities Related to Organization's Charitable, etc., Purpose.   Include income generated by the organization's exempt function activities (charitable, educational, etc.) and by its nontaxable fundraising events (excluding any contributions received, which are reported on line 15).

Examples include income from:

• Ticket sales to performances by a symphony orchestra
• Raffles, bingo, or
• Fundraising-events, income from which is not taxable as unrelated business income because -
   · Substantially all the work is performed without compensation, or
   · Carried on by the organization primarily for the convenience of its members, or
   · Consists of the selling of merchandise, substantially all of which has been received by the organization as gifts or contributions (section 513(a)(1), (2), or (3)).

Line 26b. Contributions in Excess of the 2% Limitation.   Prepare a list for your files to show the name of and amount contributed by each person (other than a governmental unit or publicly supported organization) whose total gifts for 1998 through 2001 exceeded the amount shown in line 26a. (Do not file this list with your return.) Enter the total of all these excess amounts on line 26b. An example of such a list for line 26b is given below.

Line 26b Example

Amount on line 26a of 2002 Schedule A (2% limitation)
Contributors whose total gifts from 1998 through 2001 were in excess of the 2% limitation
(a) Name	(b) 1998	(c) 1999	(d) 2000	(e) 2001	(f) Total	(g) Excess contri- butions (col. (f) less the 2% limitation)
XYZ Foundation			$59,000	$ 3,000	$62,000	$50,000
Apple Office Supply	$12,000			3,000	15,000	3,000
Plum Corporation			15,000	15,000	30,000	18,000
John Smith	5,000	$5,000	5,000	1,000	16,000	4,000
Sue Adams		10,000		10,000	20,000	8,000
Apple Trade Assoc.			20,000	7,000	27,000	15,000
Total (Carry the total of column (g) to line 26(b) of the 2002 Schedule A (Form 990 or 990-EZ)).						$98,000

Line 27a. Contributions, Membership Fees, and Gross Receipts From Disqualified Persons.   For amounts included in lines 15, 16, and 17 that were received from a disqualified person, prepare a list for your records to show the name of, and total amounts received in each year from each disqualified person. (Do not file this list with your return.) Enter the sum of such amounts for each year. An example of such a list for line 27a is given below.

Line 27a Example

(a) Name	(b) 2001	(c) 2000	(d) 1999	(e) 1998	(f) Total
David Smith	$10,000	$6,000			$16,000
Anne Parker			$8,000	$10,000	18,000
Total	$10,000	$6,000	$8,000	$10,000	$34,000
Enter the total for each year of columns (b) through (e) on line 27a, 2002 Schedule A (Form 990 or 990-EZ).
Enter the total of column (f) on the line 27a entry space for line 27d, 2002 Schedule A (Form 990 or 990-EZ).

Line 27b. Gross Receipts From Other Than Disqualified Persons.   For any amount included in line 17 that was received from each person (other than disqualified persons) prepare a list for your records to show the name of, and amount received for each year, that was more than the larger of:

1. The amount on line 25 for the year, or
2. $5,000.

After computing the difference between the amount received and the larger amount described in 1 or 2, enter the sum of these differences (the excess amounts) for each year. An example of such a list for line 27b is given below for the year 2001 entry line. Prepare similar lists to determine excess amounts for the other entry lines of 27b. (Do not file these lists with your return.)

Line 27b Example

Year 2001
(a) Name	(b) Amount received in (2001)	(c) Amount on line 25 for (2001)	(d) Enter the larger of column (c) or $5000	(e) Year (2001) Excess (column (b) less column (d))
Word Processing, Inc.	$25,000	$2,000	$5,000	$20,000
Enter the total for column (e) on line 27b for the year (2001) entry space				$20,000

Line 28. Unusual Grants.   Unusual grants generally are substantial contributions and bequests from disinterested persons and are -

1. Attracted because of the organization's publicly supported nature,
2. Unusual and unexpected because of the amount, and
3. Large enough to endanger the organization's status as normally meeting the support test described in the instructions for lines 10, 11, and 12.

A grant that meets these terms may be treated as an unusual grant (that is disregarded entirely in the public support computation) even if the organization receives the funds over a period of years. In the list of unusual grants, show only what the organization received during the year.

Do not treat gross investment income items as unusual grants. Instead, include all investment income in support.

See Rev. Rul. 76-440, 1976-2 C.B. 58 and Regulations sections 1.170A-9(e)(6)(ii) and 1.509(a)-3(c)(3) and (4) for details about unusual grants.

For an organization described in lines 10, 11, or 12 that received any unusual grants during 1998 through 2001, prepare a list for your records to show, for each year, the name of the contributor, the date and amount of the grant, and a brief description of the grant. (Do not file this list with your return.) Do not include these grants in line 15. An example for such a list for line 28 is given below.

Line 28 Example

Year 2001	Description
Name Mr. Disinterested Donor	Undeveloped land - (Volume 578, page xxx, Dept. of Land Records, Jefferson County, Ohio)
Date of Grant January 15, 2001
Amount of Grant $6,000

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