Solved by verified expert :1654. CHAPTER
15—EXEMPT ENTITIES Question TF #25
The excise tax that is imposed on private foundations for making jeopardizing
investments is imposed because the foundation has made speculative investments
that put the foundation’s income at risk.
a.
True
b. False
1655. CHAPTER
15—EXEMPT ENTITIES Question TF #26
The unrelated business income tax (UBIT) is designed to treat the entity as if
it were subject to the corporate income tax on its unrelated business taxable
income, with the highest corporate tax rate (35%) applying.
a.
True
b. False
1656. CHAPTER
15—EXEMPT ENTITIES Question TF #27
Federal agencies exempt from Federal income tax under § 501(c)(1) are not subject to the unrelated business
income tax (UBIT).
a.
True
b. False
1657. CHAPTER
15—EXEMPT ENTITIES Question TF #28
A trade or business that is operated by an exempt organization which otherwise
would be subject to the tax on unrelated business income is exempt from tax, if
the profits generated by the trade or business are used by the exempt
organization for exempt purposes.
a.
True
b. False
1658. CHAPTER
15—EXEMPT ENTITIES Question TF #29
An activity is not an unrelated trade
or business for purposes of the unrelated business income tax (UBIT) unless it
is profitable.
a.
True
b. False
1659. CHAPTER
15—EXEMPT ENTITIES Question TF #30
A profit-related activity of an exempt organization avoids the unrelated
business income tax if greater than 75% of the merchandise sold had been
received as a contribution.
a.
True
b. False
1660. CHAPTER
15—EXEMPT ENTITIES Question TF #31
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).
a.
True
b. False
1661. CHAPTER
15—EXEMPT ENTITIES Question TF #32
An exempt organization that otherwise would be classified as an unrelated trade
or businesses will not be subject to
the unrelated business income tax if the individuals performing substantially
all the work of the trade or business do so without compensation.
a.
True
b. False
1662. CHAPTER
15—EXEMPT ENTITIES Question TF #33
A corporate payment to an exempt organization that qualifies as a qualified
sponsorship payment is not subject to the unrelated business income tax (UBIT).
a.
True
b. False
1663. CHAPTER
15—EXEMPT ENTITIES Question TF #34
The income from a bingo game conducted by an exempt organization may be
unrelated business income.
a.
True
b. False
1664. CHAPTER
15—EXEMPT ENTITIES Question TF #35
The key factors in determining whether an exempt entity’s income from a bingo
game is unrelated trade or business income are whether substantially all the
work is performed by volunteers and all of the prizes to be awarded are
received as donations.
a.
True
b. False
1665. CHAPTER
15—EXEMPT ENTITIES Question TF #36
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).
a.
True
b. False
