In 1998, a decision was handed down by the Pennsylvania Supreme Court in the case of Pennsylvania Liquor Control Board v. Richard E Craft American Legion Home Corporation, in which the Court held the Home Association of that particular Post was a subordinate unit of the Post thus permitting Home Associations to apply for a liquor license as an incorporated unit of a national veterans’ organization.

 

Consequently, it was recommended to all American Legion, Department of Pennsylvania Post Commanders, based on the decision in the Craft case and the current statute (47 Purdon’s Statute §4-461.1 (a)), that Home Associations who do not have a liquor license but wish to obtain one should continue to apply as an incorporated unit of a national veterans’ organization.

 

However, it was also advised that a Home Association that currently has a liquor license transfer all other realty and assets in the Association to the Post further to insulate the Post and its assets from liability while still affording them the opportunity to have social or associate members who can contribute to the Post’s financial success.

As a result of the above mentioned case, the Department of Pennsylvania through painstaking effort was able to eventually obtain passage of the Realty Transfer Tax exemption into Act 43 of 2017, the Tax Code Bill.  The law exempts veterans’ organizations from the Realty Transfer Tax during such necessary transactions. 

 

This is important because now there is no realty transfer tax when real property vested in the name of a Home Association is transferred to the Post.  Hence, VFW Post(s) with real estate in the name of a home association/canteen/home corporation can now transfer the real estate into the name of the VFW Post(s), with no tax consequences.

Moreover, state case law states that when we have Post and Home Associations structured as laid out in the Craft case, among other things, our Post(s) and Home Association(s) can take advantage of favorable small games of chance laws in Pennsylvania.  Specifically, if a Post owns the real estate and the Home Association has the liquor license and the Home Association leases the property from the Post, the Home Association can donate to the Post as a charitable entity up to 60% of its earnings.  Of course, many of our posts also support other causes, but it is a way to help the post financially, if and when needed.

 

Leases (sample) Commercial (Commercial lease would be from Post to Home Association if the Post is adequately structured with Post owning the real estate and Home Association leasing from Post) Residential (Post-owned apartments)   Click Here