Question 1

The due date for the Exempt Organization Business Income Tax Return (Form 990-T) is the fifteenth day of the third month after the end of the taxable year.

Accepted Answer

A) True 
 B)False

Question 2

Which of the following statements is correct regarding the disclosure Regulations for exempt entities?

Accepted Answer

A) Posting the required tax forms on the Internet is an acceptable technique for satisfying the "widely available" requirement. 
B) Forms 990 and 1023 must be readily available to the general public. 
C) If an individual requests a copy of the required tax forms in writing,the exempt entity must provide a copy within 30 days. 
D) Only a.and b.are correct. 
E) a.,b.,and c.are all correct. 
A) Posting the required tax forms on the Internet is an acceptable technique for satisfying the "widely available" requirement. 
B) Forms 990 and 1023 must be readily available to the general public. 
C) If an individual requests a copy of the required tax forms in writing,the exempt entity must provide a copy within 30 days. 
D) Only a.and b.are correct. 
E) a.,b.,and c.are all correct.

Question 3

If the unrelated business income of an exempt organization is $25,000 or less,the unrelated business income tax (UBIT) is $0.

Accepted Answer

A) True 
 B)False

Question 4

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 that is required to file a return and which is not a private foundation.
e.Appropriate definition.
f.Annual information return of a private foundation.
-Form 990-PF.

Accepted Answer

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

Question 5

Which of the following statements is correct regarding the unrelated business income tax (UBIT)?

Accepted Answer

A) To be subject to the UBIT, the exempt organization must conduct a trade or business, the trade or business is not substantially related to the exempt purpose of the organization, and the trade or business is regularly carried on by the organization. 
B) To be subject to the UBIT, the exempt organization must conduct a trade or business, the trade or business must be substantially related to the exempt purpose of the organization, and the trade or business must be regularly carried on by the organization. 
C) To be subject to the UBIT, the exempt organization must conduct a trade or business, the trade or business is not substantially related to the exempt purpose of the organization, and the trade or business is carried on during more than half the year. 
D) An exempt entity that conducts a business that competes with for-profit businesses automatically is subject to the UBIT. 
E) None of the above statements is correct. 
A) To be subject to the UBIT, the exempt organization must conduct a trade or business, the trade or business is not substantially related to the exempt purpose of the organization, and the trade or business is regularly carried on by the organization. 
B) To be subject to the UBIT, the exempt organization must conduct a trade or business, the trade or business must be substantially related to the exempt purpose of the organization, and the trade or business must be regularly carried on by the organization. 
C) To be subject to the UBIT, the exempt organization must conduct a trade or business, the trade or business is not substantially related to the exempt purpose of the organization, and the trade or business is carried on during more than half the year. 
D) An exempt entity that conducts a business that competes with for-profit businesses automatically is subject to the UBIT. 
E) None of the above statements is correct.

Question 6

A feeder organization is exempt from Federal income taxation because it carries on a trade or business for the benefit of an exempt organization and remits its profits to the exempt entity.

Accepted Answer

A) True 
 B)False

Question 7

Match the following statements.
a.Distribution of such items is not considered an unrelated trade or business if they are "low-cost items".
b.Is considered an unrelated trade or business if the amount received is contingent upon the level of attendance at one or more events
c.Is considered an unrelated trade or business if legally it can be conducted by commercial (for-profit) entities.
d.A trade or business that consists of either renting or exchanging these with another exempt organization is not an unrelated trade or business.
-Membership lists

Accepted Answer

The answer of Match the following statements.
a.Distribution of such items...

Question 8

The League of Women Voters is a § 501(c)(3) organization.

Accepted Answer

A) True 
 B)False

Question 9

Only certain exempt organizations must obtain IRS approval to obtain exempt status.

Accepted Answer

A) True 
 B)False

Question 10

Certain § 501(c)(3) exempt organizations are permitted to engage in lobbying activities in the same manner as a C corporation.

Accepted Answer

A) True 
 B)False

Question 11

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 that is required to file a return and which is not a private foundation.
e.Appropriate definition.
f.Annual information return of a private foundation.
-Unrelated business income is generally that derived from the unrelated trade or business,reduced by the deductions directly connected with the conduct of the unrelated trade or business.

Accepted Answer

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

Question 12

General requirements for exempt status include the organization serving the common good and the organization being a not-for-profit entity.

Accepted Answer

A) True 
 B)False

Question 13

Which of the following statements regarding intermediate sanctions is correct?

Accepted Answer

A) Intermediate sanctions are self-assessing (i.e., calculated and paid by the taxpayer rather than being imposed by the IRS). 
B) The excise tax is imposed on the exempt organization and on disqualified persons. 
C) Both a first-level tax and a second-level tax may apply. 
D) The corporate tax rates apply in calculating the amount of the tax liability. 
A) Intermediate sanctions are self-assessing (i.e., calculated and paid by the taxpayer rather than being imposed by the IRS). 
B) The excise tax is imposed on the exempt organization and on disqualified persons. 
C) Both a first-level tax and a second-level tax may apply. 
D) The corporate tax rates apply in calculating the amount of the tax liability.

Question 14

If personal property is leased with real property and more than 45% 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 15

For each of the following taxes which are imposed on private foundations and/or Foundation Managers, match the appropriate initial tax or additional tax.
a.10% initial tax and 25% additional tax on private foundation.
b.30% initial tax and 100% additional tax on private foundation.
c.10% initial tax and 200% additional tax on private foundation.
d.10% initial tax and 100% additional tax on disqualified person.
e.​10% initial tax and 200% additional tax on the disqualified person.
-Tax on excess business holdings

Accepted Answer

The answer of For each of the following taxes which...

Question 16

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.
-§ 501(c)(3) organization

Accepted Answer

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

Question 17

The excise taxes such as the tax on self-dealing and the tax on excess business holdings are imposed on exempt organizations classified as private foundations.The taxes are not imposed on exempt organizations classified as public charities.

Accepted Answer

A) True 
 B)False

Question 18

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 19

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?
b. change if the amount of the payment was $7,500 instead of $20,000?
c.Would your answer in

Accepted Answer

The answer of Midnight Basketball,Inc.,an exempt organization that organizes and...

Question 20

Certain § 501(c)(3) exempt organizations are permitted to engage in lobbying activities on a limited basis.Churches are allowed to make this election.

Accepted Answer

A) True 
 B)False

Exam 23: Exempt Entities

The due date for the Exempt Organization Business Income Tax Return (Form 990-T) is the fifteenth day of the third month after the end of the taxable year.

Which of the following statements is correct regarding the disclosure Regulations for exempt entities?

If the unrelated business income of an exempt organization is $25,000 or less,the unrelated business income tax (UBIT) is $0.

Which of the following statements is correct regarding the unrelated business income tax (UBIT)?

A feeder organization is exempt from Federal income taxation because it carries on a trade or business for the benefit of an exempt organization and remits its profits to the exempt entity.

The League of Women Voters is a § 501(c)(3) organization.

Only certain exempt organizations must obtain IRS approval to obtain exempt status.

Certain § 501(c)(3) exempt organizations are permitted to engage in lobbying activities in the same manner as a C corporation.

General requirements for exempt status include the organization serving the common good and the organization being a not-for-profit entity.

Which of the following statements regarding intermediate sanctions is correct?

If personal property is leased with real property and more than 45% of the rent income under the lease is from personal property,all of the rent income is subject to the unrelated business income tax.

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. -§ 501(c)(3) organization

The excise taxes such as the tax on self-dealing and the tax on excess business holdings are imposed on exempt organizations classified as private foundations.The taxes are not imposed on exempt organizations classified as public charities.

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

Certain § 501(c)(3) exempt organizations are permitted to engage in lobbying activities on a limited basis.Churches are allowed to make this election.

An Introduction to Taxation and Understanding the Federal Tax Law

Working With the Tax Law

Computing the Tax

Gross Income: Concepts and Inclusions

Gross Income: Exclusions

Deductions and Losses: in General

Deductions and Losses: Certain Business Expenses and Losses

Depreciation, cost Recovery, amortization, and Depletion

Deductions: Employee and Self-Employed-Related Expenses

Deductions and Losses: Certain Itemized Deductions

Investor Losses

Tax Credits and Payments

Property Transactions: Determination of Gain or Loss, basis Considerations, and Nontaxable Exchanges

Property Transactions, capital Gains and Losses, sec1231, and Recapture Provisions

Alternative Minimum Tax

Accounting Periods and Methods

Corporations: Introduction and Operating Rules

Corporations: Organization and Capital Structure

Corporations: Distributions Not in Complete Liquidation

Corporations: Distributions in Complete Liquidation and an Overview of Reorganization

Partnerships

S Corporations

Multistate Corporate Taxation

Taxation of International Transactions

Tax Practice and Ethics

The Federal Gift and Estate Taxes

Income Taxation of Trusts and Estates

Filters