Question 1

Is the taxation of a feeder organization influenced by the percentage of its earnings that it remits to an exempt organization?

Accepted Answer

No. While a feeder organization carries

Question 2

Why are some organizations exempt from Federal income tax?

Accepted Answer

The Code's treatment of exempt organizat

Question 3

If personal property is leased with real property and more than 80% 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 4

An exempt organization can avoid classification as a private foundation if it is broadly publicly supported. To be broadly publicly supported, which of the following is required?

Accepted Answer

A)  The exempt organization does not receive support from a feeder organization. 
B)  An external support test is satisfied. 
C)  An internal support test is satisfied. 
D)  Only b. and c. must be satisfied. 
E)  a., b., and c. must be satisfied. 
A)  The exempt organization does not receive support from a feeder organization. 
B)  An external support test is satisfied. 
C)  An internal support test is satisfied. 
D)  Only b. and c. must be satisfied. 
E)  a., b., and c. must be satisfied.

Question 5

A corporate payment to an exempt organization that qualifies as a qualified sponsorship payment is not subject to the unrelated business income tax (UBIT).

Accepted Answer

A) True 
 B)False

Question 6

Which of the following excise taxes are imposed on the private foundation because it engages in prohibited transactions?

Accepted Answer

A)  Tax on investment income. 
B)  Tax on self-dealing. 
C)  Tax on failure to distribute income. 
D)  Only b. and c. 
E)  a., b., and c. 
A)  Tax on investment income. 
B)  Tax on self-dealing. 
C)  Tax on failure to distribute income. 
D)  Only b. and c. 
E)  a., b., and c.

Question 7

If an organization qualifies for exempt status for Federal income tax purposes, it is exempt from all Federal income taxes.

Accepted Answer

A) True 
 B)False

Question 8

The excise tax imposed on a private foundation's investment income can be imposed both as an initial (first-level) tax and an additional (second-level) tax.

Accepted Answer

A) True 
 B)False

Question 9

Discuss any negative tax consequences that result from an exempt organization being classified as a private foundation.

Accepted Answer

Two potential negative tax consequences

Question 10

Orange, Inc., a private foundation, engages in a transaction with a disqualified person in the amount of $800,000. Calculate the tax on self-dealing. Assume that corrective action is taken so that the additional tax does not apply.

Accepted Answer

The initial tax on the disqualified pers

Question 11

The Dispensary is a pharmacy that is part of a § 501(c)(3) hospital. Its primary mission is to dispense medicines for hospital patients. In addition, the pharmacy dispenses medicines to former hospital patients for a period of up to 30 days after discharge from the hospital. It does this for the dual purpose of convenience to the former patients (i.e., the closest pharmacy is 6 miles away), and to ensure that the former patients receive the medicines that have been prescribed for them.
The Dispensary carefully carries out the policy of the hospital board that no more than 20% of its gross revenues come from former-patient medicine sales. If necessary, in December of each year, sales to former patients are curtailed to assure compliance with this policy. Sales revenue from each of the two sources is as follows for 2011.
   Calculate the amount of The Dispensary's unrelated business gross income.

Accepted Answer

For any of the activities of The Dispens

Is the taxation of a feeder organization influenced by the percentage of its earnings that it remits to an exempt organization?

Why are some organizations exempt from Federal income tax?

If personal property is leased with real property and more than 80% of the rent income under the lease is from personal property, all of the rent income is subject to the unrelated business income tax.

An exempt organization can avoid classification as a private foundation if it is broadly publicly supported. To be broadly publicly supported, which of the following is required?

A corporate payment to an exempt organization that qualifies as a qualified sponsorship payment is not subject to the unrelated business income tax (UBIT).

Which of the following excise taxes are imposed on the private foundation because it engages in prohibited transactions?

If an organization qualifies for exempt status for Federal income tax purposes, it is exempt from all Federal income taxes.

The excise tax imposed on a private foundation's investment income can be imposed both as an initial (first-level) tax and an additional (second-level) tax.

Discuss any negative tax consequences that result from an exempt organization being classified as a private foundation.

Orange, Inc., a private foundation, engages in a transaction with a disqualified person in the amount of $800,000. Calculate the tax on self-dealing. Assume that corrective action is taken so that the additional tax does not apply.

Understanding and Working With the Federal Tax Law

Corporations: Introduction and Operating Rules

Corporations: Special Situations

Corporations: Organization and Capital Structure

Corporations: Earnings 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

Taxes on the Financial Statements

Multistate Corporate Taxation

Tax Practice and Ethics

The Federal Gift and Estate Taxes

Family Tax Planning

Income Taxation of Trusts and Estates

Filters

Exam 15: Exempt Entities

Is the taxation of a feeder organization influenced by the percentage of its earnings that it remits to an exempt organization?

Why are some organizations exempt from Federal income tax?

If personal property is leased with real property and more than 80% of the rent income under the lease is from personal property, all of the rent income is subject to the unrelated business income tax.

An exempt organization can avoid classification as a private foundation if it is broadly publicly supported. To be broadly publicly supported, which of the following is required?

A corporate payment to an exempt organization that qualifies as a qualified sponsorship payment is not subject to the unrelated business income tax (UBIT).

Which of the following excise taxes are imposed on the private foundation because it engages in prohibited transactions?

If an organization qualifies for exempt status for Federal income tax purposes, it is exempt from all Federal income taxes.

The excise tax imposed on a private foundation's investment income can be imposed both as an initial (first-level) tax and an additional (second-level) tax.

Discuss any negative tax consequences that result from an exempt organization being classified as a private foundation.

Orange, Inc., a private foundation, engages in a transaction with a disqualified person in the amount of $800,000. Calculate the tax on self-dealing. Assume that corrective action is taken so that the additional tax does not apply.

Understanding and Working With the Federal Tax Law

Corporations: Introduction and Operating Rules

Corporations: Special Situations

Corporations: Organization and Capital Structure

Corporations: Earnings 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

Taxes on the Financial Statements

Multistate Corporate Taxation

Tax Practice and Ethics

The Federal Gift and Estate Taxes

Family Tax Planning

Income Taxation of Trusts and Estates

Filters