Question 1

What are the excise taxes imposed on private foundations, and why are they imposed?

Accepted Answer

The excise taxes imposed on private foun...

Question 2

Match the following statements.
-Membership lists

Accepted Answer

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, broadcast ratings, or other factors indicating the degree of public exposure to one or more events.
C)  Is considered an unrelated trade or business if 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.E) B) and C)
F) C) and D)

Question 3

An exempt organization is located in the state of Nevada. Gambling in Nevada is legal. Therefore, bingo games are conducted by both taxable and tax-exempt organizations. If the net earnings from the bingo games are less than $25,000, the exempt organization is not subject to the unrelated business income tax (UBIT).

Accepted Answer

A) True 
 B)False

Question 4

All organizations that are exempt from Federal income tax are exempt under § 501(c)(3).

Accepted Answer

A) True 
 B)False

Question 5

Warmth, Inc., a private foundation, makes an expenditure of $800,000 that should not be made by a private foundation. Calculate the tax on taxable expenditures. Assume that corrective action is taken so that the additional tax does not apply.

Accepted Answer

The initial tax on the private...

Question 6

Unrelated debt-financed income, net of the unrelated debt-financed deductions, is subject to the unrelated business income tax only if the exempt organization is a private foundation.

Accepted Answer

A) True 
 B)False

Question 7

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

Accepted Answer

A) True 
 B)False

Question 8

Give an example of the indicated types of exempt organizations.
-§ 501(c) (3)  organization

Accepted Answer

A)  League of Women Voters.
B)  Teachers' association.
C)  American Plywood Association.
D)  Six Flags over Texas theme park.
E)  Salvation Army.F) B) and C)
G) B) and E)

Question 9

The excise tax imposed on private foundations for excess business holdings is imposed on investments that enable the private foundation to control publicly-held rather than privately-held businesses.

Accepted Answer

A) True 
 B)False

Question 10

Match the following statements.
-Corporate sponsorship payments

Accepted Answer

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, broadcast ratings, or other factors indicating the degree of public exposure to one or more events.
C)  Is considered an unrelated trade or business if 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.E) B) and C)
F) A) and D)

Question 11

To satisfy the "not for profit" requirement for exempt status, the entity may not be engaged in a trade or business.

Accepted Answer

A) True 
 B)False

Question 12

Match the following statements.
-The trade or business is not substantially related to the exempt purpose of the organization.

Accepted Answer

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.G) A) and C)
H) A) and E)

Question 13

Maroon, Inc., a tax-exempt organization, leases a building and equipment to Brown Partnership. The rental income from the building is $100,000 and from the equipment is $9,000. Rental expenses are $40,000 for the building and $4,000 for the equipment. 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.F) All of the above
G) A) and D)

Question 14

Match the following statements.
-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

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.G) E) and F)
H) D) and F)

Question 15

Match the following statements with the correct description.
-University of Virginia

Accepted Answer

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.F) B) and C)
G) A) and B)

Question 16

If an exempt organization distributes "low­cost items" as an incidental part of its solicitation for charitable
contributions, the distribution is not considered an unrelated trade or business.
a. Under what dollar amount is a distribution no longer a "low-cost item"?
b. Provide examples of low-cost items.

Accepted Answer

a. For 2014, a low-cost item i...

Question 17

If an exempt organization conducts a trade or business that is regularly carried on by the organization, it is subject to the unrelated business income tax (UBIT).

Accepted Answer

A) True 
 B)False

Question 18

Which of the following activities is not subject to the feeder organization rules?

Accepted Answer

A)   At least 80% of the net income of the for-profit entity is contributed to the exempt organization for a consecutive three-year period.
B)   A trade or business where substantially all the work is performed by volunteers.
C)   A trade or business of selling merchandise where substantially all of the merchandise has been received as contributions or gifts.
D)   Only b. and c.
E)   a., b., and c.F) A) and E)
G) D) and E)

Question 19

For purposes of the unrelated business income tax (UBIT) , land that is acquired by the exempt organization for later exempt-use is excluded from the definition of debt-financed property if certain requirements are satisfied. Which of the following is not included in the requirements?

Accepted Answer

A)   The principal purpose of acquiring the land is for use (substantially all)  in achieving the organization's exemptPurpose.
B)   The fair market value of the land is not over 50% of the fair market value of land presently owned by the exempt organization.
C)   The use of the land by the exempt organization will begin within ten years of the acquisition date.
D)   At the date the land is acquired, it is located in the neighborhood of other property of the organization forWhich substantially all the use is for achieving the organization's exempt purpose.
E)   All of the above are requirements.F) A) and B)
G) A) and C)

Question 20

Spirit, Inc., a § 501(c)(3) organization, is classified as a private foundation. It has investment income of $175,000. Calculate Spirit's tax on its investment income.

Accepted Answer

The answer of Spirit, Inc., a § 501(c)(3) organization, is...

Exam 23: Exempt Entities

Give an example of the indicated types of exempt organizations. -§ 501(c) (3) organization

Correct Answer
verified

Warmth, Inc., a private foundation, makes an expenditure of $800,000 that should not be made by a private foundation. Calculate the tax on taxable expenditures. Assume that corrective action is taken so that the additional tax does not apply.

Correct Answer
verified
The initial tax on the private...
View Answer

To satisfy the "not for profit" requirement for exempt status, the entity may not be engaged in a trade or business.

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

If an exempt organization conducts a trade or business that is regularly carried on by the organization, it is subject to the unrelated business income tax (UBIT).

Correct Answer
verified

Match the following statements with the correct description. -University of Virginia

Correct Answer
verified

Correct Answer
verified
a. For 2014, a low-cost item i...
View Answer

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

Correct Answer
verified

For purposes of the unrelated business income tax (UBIT) , land that is acquired by the exempt organization for later exempt-use is excluded from the definition of debt-financed property if certain requirements are satisfied. Which of the following is not included in the requirements?

Correct Answer
verified

Match the following statements. -Corporate sponsorship payments

Correct Answer
verified

Which of the following activities is not subject to the feeder organization rules?

Correct Answer
verified

What are the excise taxes imposed on private foundations, and why are they imposed?

Correct Answer
verified
The excise taxes imposed on private foun...
View Answer

Spirit, Inc., a § 501(c)(3) organization, is classified as a private foundation. It has investment income of $175,000. Calculate Spirit's tax on its investment income.

Correct Answer
verified

All organizations that are exempt from Federal income tax are exempt under § 501(c)(3).

Correct Answer
verified

Match the following statements. -The trade or business is not substantially related to the exempt purpose of the organization.

Correct Answer
verified

Match the following statements. -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.

Correct Answer
verified

Unrelated debt-financed income, net of the unrelated debt-financed deductions, is subject to the unrelated business income tax only if the exempt organization is a private foundation.

Correct Answer
verified

Match the following statements. -Membership lists

Correct Answer
verified

The excise tax imposed on private foundations for excess business holdings is imposed on investments that enable the private foundation to control publicly-held rather than privately-held businesses.

Correct Answer
verified

Exam 23: Exempt Entities

Give an example of the indicated types of exempt organizations. -§ 501(c) (3) organization

Correct AnswerverifiedShow Answer

Warmth, Inc., a private foundation, makes an expenditure of $800,000 that should not be made by a private foundation. Calculate the tax on taxable expenditures. Assume that corrective action is taken so that the additional tax does not apply.

Correct AnswerverifiedThe initial tax on the private...View AnswerShow Answer

To satisfy the "not for profit" requirement for exempt status, the entity may not be engaged in a trade or business.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

If an exempt organization conducts a trade or business that is regularly carried on by the organization, it is subject to the unrelated business income tax (UBIT).

Correct AnswerverifiedShow Answer

Match the following statements with the correct description. -University of Virginia

Correct AnswerverifiedShow Answer

Correct Answerverifieda. For 2014, a low-cost item i...View AnswerShow Answer

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

Correct AnswerverifiedShow Answer

For purposes of the unrelated business income tax (UBIT) , land that is acquired by the exempt organization for later exempt-use is excluded from the definition of debt-financed property if certain requirements are satisfied. Which of the following is not included in the requirements?

Correct AnswerverifiedShow Answer

Match the following statements. -Corporate sponsorship payments

Correct AnswerverifiedShow Answer

Which of the following activities is not subject to the feeder organization rules?

Correct AnswerverifiedShow Answer

What are the excise taxes imposed on private foundations, and why are they imposed?

Correct AnswerverifiedThe excise taxes imposed on private foun...View AnswerShow Answer

Spirit, Inc., a § 501(c)(3) organization, is classified as a private foundation. It has investment income of $175,000. Calculate Spirit's tax on its investment income.

Correct AnswerverifiedShow Answer

All organizations that are exempt from Federal income tax are exempt under § 501(c)(3).

Correct AnswerverifiedShow Answer

Match the following statements. -The trade or business is not substantially related to the exempt purpose of the organization.

Correct AnswerverifiedShow Answer

Match the following statements. -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.

Correct AnswerverifiedShow Answer

Unrelated debt-financed income, net of the unrelated debt-financed deductions, is subject to the unrelated business income tax only if the exempt organization is a private foundation.

Correct AnswerverifiedShow Answer

Match the following statements. -Membership lists

Correct AnswerverifiedShow Answer

The excise tax imposed on private foundations for excess business holdings is imposed on investments that enable the private foundation to control publicly-held rather than privately-held businesses.

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified
The initial tax on the private...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
a. For 2014, a low-cost item i...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
The excise taxes imposed on private foun...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified