Taxes: Tax-Exempt Organizations

Question 1

Taxes:

Tax-Exempt Organizations

Answer 1

Tax-Exempt Organizations

• Charities, labor organizations, social clubs, pension and profit sharing trusts, and private foundations
• must apply for and receive exemption
• must file if gross receipts > $50k (not churches)
• Operate exclusively for tax-exempt purpose
• Not for influencing politics

Question 2

Taxes:
Tax-Exempt Organizations
Unrelated Business Income

Answer 2

Unrelated Business Income
- from a business regularly carried on and
- not for exempt purpose
- income from debt-financed property unrelated to exemption
- income from advertising in journals
- taxed only if >$1k at corporate rates
Related Income includes
- work performed for no compensation
- convenience of students or members
- sale of merchandise/stock received as contributions
- investment income
- rent from real property