Tax-Exempt Organizations

Question 1

What is the amount of unrelated business income exempt from tax?

Answer 1

There is a $1,000 specific exemption from tax on unrelated business income.

Question 2

What does unrelated business income of exempt organizations NOT include?

Answer 2

An unrelated business does not include any activity where all the work is performed by the organization by unpaid volunteers.

Question 3

Section 509 private foundations include all Section 501(c) organizations, except:

Answer 3

1. Max 60% charitable deduction donees
2. Broadly publicly-supported organizations
3. Supporting organizations
4. Public safety organizations

Question 4

Unrelated business income is:

Answer 4

1. Derived from an activity that constitutes a trade or business,
2. Is regularly carried on, and
3. Is not substantially related to the organization’s tax-exempt purpose.

Question 5

What types of business may NOT qualify for a 501(c)(3) exemption from federal income taxes?

Answer 5

Partnerships

Question 6

An incorporated exempt organization must make estimated tax payments if its tax can be reasonably expected to be $XXX or more.

Answer 6

$500 or more