Publication 598 - Introductory Material
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Under section 6104(d), a section 501(c)(3) organization that has gross income from an unrelated trade or business of $1,000
or more must
make its annual exempt organization business income tax return (including amended returns) available for public inspection.
However, a section
501(c)(3) organization filing the Form 990-T only to request a credit for certain federal excise taxes paid does not have
to make the Form 990-T
available for public inspection. See the Instructions for Form 990-T for more information.
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Qualifying specified payments from a controlled entity are included in an exempt organization's unrelated business taxable
income only on
the amount that exceeds that which would have been paid or accrued if the payments had been determined under section 482.
An addition to the valuation
misstatements applies to these payments. See the Income From Controlled Organizations on page 14 for more information.
An exempt organization is not taxed on its income from an activity that is substantially related to the charitable, educational,
or other purpose
that is the basis for the organization's exemption. Such income is exempt even if the activity is a trade or business.
However, if an exempt organization regularly carries on a trade or business that is not substantially related to its exempt
purpose, except that it
provides funds to carry out that purpose, the organization is subject to tax on its income from that unrelated trade or business.
This publication covers the rules for the tax on unrelated business income of exempt organizations. It explains:
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Which organizations are subject to the tax (chapter 1),
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What the requirements are for filing a tax return (chapter 2),
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What an unrelated trade or business is (chapter 3), and
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How to figure unrelated business taxable income (chapter 4).
All section references in this publication are to the Internal Revenue Code.
Useful Items - You may want to see:
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