Question 1

An exempt educational organization is permitted to make lobbying expenditures if the payments relate to education or charity and do not exceed $25,000.

Accepted Answer

A) True 
 B)False

Question 2

Radio,Inc.,an exempt organization,trains disabled individuals to be radio announcers.Rather than hold a traditional graduation exercise,the graduates compete in a radio announcer contest.Such activities are held four times each year.An admission fee of $10 is charged to the general public to attend the contest.Eight hundred people attended the contest this year,and prizes of $2,000 were given to the top 3 graduates.Calculate the amount of Radio's unrelated business income from this activity.

Accepted Answer

The contest activity is not classified a

Question 3

Which of the following exempt organizations are required to file Form 990 (Return of Organization Exempt from Income Tax)?

Accepted Answer

A) Federal agencies. 
B) Churches. 
C) Exempt organizations whose annual gross receipts do not exceed $25,000. 
D) Private foundations. 
E) None of these entities must file Form 990. 
A) Federal agencies. 
B) Churches. 
C) Exempt organizations whose annual gross receipts do not exceed $25,000. 
D) Private foundations. 
E) None of these entities must file Form 990.

Question 4

Which of the following are exempt organizations?

Accepted Answer

A) National Collegiate Athletic Association (NCA
A) . 
B) American Bankers Association (AB
A) . 
C) Professional Golfers Association (PG
A) . 
D) Only a.and c. 
E) a.,b.,and c. 
A) National Collegiate Athletic Association (NCA
A) . 
B) American Bankers Association (AB
A) . 
C) Professional Golfers Association (PG
A) . 
D) Only a.and c. 
E) a.,b.,and c.

Question 5

Which of the following statements is correct?

Accepted Answer

A) A private foundation is,in general,exempt from Federal income tax. 
B) A private foundation may be subject to certain types of Federal income tax. 
C) If a broad public support test is satisfied,an exempt organization that otherwise would be classified as a private foundation is not classified as a private foundation. 
D) Only b.and c.are correct. 
E) a.,b.,and c.are correct. 
A) A private foundation is,in general,exempt from Federal income tax. 
B) A private foundation may be subject to certain types of Federal income tax. 
C) If a broad public support test is satisfied,an exempt organization that otherwise would be classified as a private foundation is not classified as a private foundation. 
D) Only b.and c.are correct. 
E) a.,b.,and c.are correct.

Question 6

Maroon,Inc.,a tax-exempt organization,leases a building and machinery to Brown Partnership.The rental income from the building is $100,000,with related expenses of $40,000.The rental income from the machinery is $9,000,with related expenses of $4,000.What adjustment must be made to net unrelated business income?

Accepted Answer

A) $0. 
B) ($60,000). 
C) ($65,000). 
D) ($109,000). 
E) Some other amount. 
A) $0. 
B) ($60,000). 
C) ($65,000). 
D) ($109,000). 
E) Some other amount.

Question 7

While engaging in a prohibited transaction can result in an exempt organization being subject to tax,it will not result in an exempt organization losing its exempt status.

Accepted Answer

A) True 
 B)False

Question 8

If an exempt organization is required to file an annual information return,on what form is it filed?

Accepted Answer

Exempt organizations that are

Question 9

If personal property is leased with real property and more than 50% of the rent income under the lease is from personal property,all of the rent income is subject to the unrelated business income tax.

Accepted Answer

A) True 
 B)False

Question 10

Wonder,Inc.,a § 501(c)(3)exempt organization,acquired all the stock of a for-profit corporation for $100,000.Wonder is a private foundation.The acquired corporation was not a related business.Calculate the tax on excess business holdings.Assume that corrective action is taken so that the additional tax does not apply.

Accepted Answer

The initial tax on the private

Question 11

Define a qualified corporate sponsorship payment.

Accepted Answer

A payment qualifies

Question 12

Join,Inc.,a § 501(c)(3)exempt organization,engages in an excess benefit transaction.The amount of the excess benefit is $90,000.Calculate the amount of the excise tax (first-level tax)imposed under the intermediate sanctions provision.

Accepted Answer

Under the intermediate sanctio

Question 13

Match the following statements.
a.Exempt from tax on unrelated business.
b.Inappropriate definition.
c.Exempt organization may be subject to the tax on unrelated business income.
d.Annual information return of an exempt organization which is not a private foundation.
e.Appropriate definition.
f.Annual information return of a private foundation.
-Debt-financed income is the net income from debt financed property.

Accepted Answer

The answer of Match the following statements.
a.Exempt from tax on...

Question 14

Give an example of the indicated types of exempt organizations.
a.League of Women Voters.
b.Teachers' association.
c.American Plywood Association.
d.Six Flags over Texas theme park.
e.Salvation Army.
-Not an exempt organization

Accepted Answer

The answer of Give an example of the indicated types...

Question 15

The income from a bingo game conducted by an exempt organization may be unrelated business income.

Accepted Answer

A) True 
 B)False

Question 16

Midnight Basketball,Inc.,an exempt organization that organizes and conducts basketball games for youths ages 10-13,receives a $20,000 contribution from Brown Shoe Company.Midnight agrees to put Brown's logo on the cover of its monthly newsletter.
a.Is the contribution unrelated business income to Midnight?
b.Assume that instead of putting Brown's logo on the cover of its newsletter, Midnight agrees to include a statement in the newsletter that youth playing in the games conducted by Midnight wear only shoes manufactured by Brown. Is the contribution unrelated business income to Midnight?

Accepted Answer

a.No.The $20,000 payment is a qualified

Question 17

Robin,Inc.,an exempt organization,acquired a building for $400,000 which it will lease to XYZ,Inc.,for $40,000 annually.To finance the acquisition of the building,Robin secures a mortgage on it of $250,000.Advise Robin as to whether it has any unrelated debt-financed income or deductions.

Accepted Answer

The building is appropriately classified

Question 18

Match the following tax forms.
a.Return of Private Foundation.
b.Application for Recognition of Exemption under § 501(c)(3).
c.Return of Organization Exempt from Income Tax.
d.Return of Certain Excise Taxes on Charities and Other Persons.
e.Application for Recognition of Exemption under § 501(a).
f.Application for Extension of Time.
-Form 2758

Accepted Answer

The answer of Match the following tax forms.
a.Return of Private...

Question 19

Match the following tax forms.
a.Return of Private Foundation.
b.Application for Recognition of Exemption under § 501(c)(3).
c.Return of Organization Exempt from Income Tax.
d.Return of Certain Excise Taxes on Charities and Other Persons.
e.Application for Recognition of Exemption under § 501(a).
f.Application for Extension of Time.
-Form 990-PF

Accepted Answer

The answer of Match the following tax forms.
a.Return of Private...

Question 20

Match the following statements with the correct description.
a.Exempt organization under § 501(c)(3).
b.May not be subject to Federal income tax.
c.Permits limited lobbying activities.
d.Exempt organization under § 501(c)(7).
e.Carries on a trade or business for the benefit of an exempt organization and remits its profits to the exempt organization.
-Feeder organization

Accepted Answer

The answer of Match the following statements with the correct...

An exempt educational organization is permitted to make lobbying expenditures if the payments relate to education or charity and do not exceed $25,000.

Which of the following exempt organizations are required to file Form 990 (Return of Organization Exempt from Income Tax)?

Which of the following are exempt organizations?

Which of the following statements is correct?

While engaging in a prohibited transaction can result in an exempt organization being subject to tax,it will not result in an exempt organization losing its exempt status.

If an exempt organization is required to file an annual information return,on what form is it filed?

If personal property is leased with real property and more than 50% of the rent income under the lease is from personal property,all of the rent income is subject to the unrelated business income tax.

Define a qualified corporate sponsorship payment.

Join,Inc.,a § 501(c)(3)exempt organization,engages in an excess benefit transaction.The amount of the excess benefit is $90,000.Calculate the amount of the excise tax (first-level tax)imposed under the intermediate sanctions provision.

Give an example of the indicated types of exempt organizations. a.League of Women Voters. b.Teachers' association. c.American Plywood Association. d.Six Flags over Texas theme park. e.Salvation Army. -Not an exempt organization

The income from a bingo game conducted by an exempt organization may be unrelated business income.

Robin,Inc.,an exempt organization,acquired a building for $400,000 which it will lease to XYZ,Inc.,for $40,000 annually.To finance the acquisition of the building,Robin secures a mortgage on it of $250,000.Advise Robin as to whether it has any unrelated debt-financed income or deductions.

Understanding and Working With the Federal Tax Law

Corporations: Introduction and Operating Rules

Corporations: Special Situations

Corporations: Organization and Capital Structure

Corporations: Earnings and Profits and Dividend Distributions

Corporations: Redemptions and Liquidations

Corporations: Reorganizations

Consolidated Tax Returns

Taxation of International Transactions

Partnerships: Formation, operation, and Basis

Partnerships: Distributions, transfer of Interests, and Terminations

S Corporations

Comparative Forms of Doing Business

Multistate Corporate Taxation

Tax Practice and Ethics

The Federal Gift and Estate Taxes

Family Tax Planning

Income Taxation of Trusts and Estates

Filters

Exam 14: Exempt Entities

An exempt educational organization is permitted to make lobbying expenditures if the payments relate to education or charity and do not exceed $25,000.

Which of the following exempt organizations are required to file Form 990 (Return of Organization Exempt from Income Tax)?

Which of the following are exempt organizations?

Which of the following statements is correct?

While engaging in a prohibited transaction can result in an exempt organization being subject to tax,it will not result in an exempt organization losing its exempt status.

If an exempt organization is required to file an annual information return,on what form is it filed?

If personal property is leased with real property and more than 50% of the rent income under the lease is from personal property,all of the rent income is subject to the unrelated business income tax.

Define a qualified corporate sponsorship payment.

Join,Inc.,a § 501(c)(3)exempt organization,engages in an excess benefit transaction.The amount of the excess benefit is $90,000.Calculate the amount of the excise tax (first-level tax)imposed under the intermediate sanctions provision.

Give an example of the indicated types of exempt organizations. a.League of Women Voters. b.Teachers' association. c.American Plywood Association. d.Six Flags over Texas theme park. e.Salvation Army. -Not an exempt organization

The income from a bingo game conducted by an exempt organization may be unrelated business income.

Robin,Inc.,an exempt organization,acquired a building for $400,000 which it will lease to XYZ,Inc.,for $40,000 annually.To finance the acquisition of the building,Robin secures a mortgage on it of $250,000.Advise Robin as to whether it has any unrelated debt-financed income or deductions.

Understanding and Working With the Federal Tax Law

Corporations: Introduction and Operating Rules

Corporations: Special Situations

Corporations: Organization and Capital Structure

Corporations: Earnings and Profits and Dividend Distributions

Corporations: Redemptions and Liquidations

Corporations: Reorganizations

Consolidated Tax Returns

Taxation of International Transactions

Partnerships: Formation, operation, and Basis

Partnerships: Distributions, transfer of Interests, and Terminations

S Corporations

Comparative Forms of Doing Business

Multistate Corporate Taxation

Tax Practice and Ethics

The Federal Gift and Estate Taxes

Family Tax Planning

Income Taxation of Trusts and Estates

Filters