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Https Mypay Dfas Mil

Https mypay dfas mil 4. Https mypay dfas mil   Unrelated Business Taxable Income Table of Contents IncomeExclusions Dues of Agricultural Organizations and Business Leagues DeductionsDirectly Connected Exploitation of Exempt Activity—Advertising Sales Modifications Partnership Income or Loss S Corporation Income or Loss Special Rules for Foreign Organizations Special Rules for Social Clubs, VEBAs, SUBs, and GLSOsIncome that is set aside. Https mypay dfas mil Special Rules for Veterans' Organizations Income From Controlled OrganizationsAddition to tax for valuation misstatements. Https mypay dfas mil Net unrelated income. Https mypay dfas mil Net unrelated loss. Https mypay dfas mil Control. Https mypay dfas mil Income from property financed with qualified 501(c)(3) bonds. Https mypay dfas mil Disposition of property received from taxable subsidiary and used in unrelated business. Https mypay dfas mil Income From Debt-Financed Property Debt-Financed PropertyAcquisition Indebtedness Computation of Debt-Financed Income Deductions for Debt-Financed Property Allocation Rules How to Get Tax Help The term “unrelated business taxable income” generally means the gross income derived from any unrelated trade or business regularly conducted by the exempt organization, less the deductions directly connected with carrying on the trade or business. Https mypay dfas mil If an organization regularly carries on two or more unrelated business activities, its unrelated business taxable income is the total of gross income from all such activities less the total allowable deductions attributable to all the activities. Https mypay dfas mil In computing unrelated business taxable income, gross income and deductions are subject to the modifications and special rules explained in this chapter. Https mypay dfas mil Whether a particular item of income or expense falls within any of these modifications or special rules must be determined by all the facts and circumstances in each specific case. Https mypay dfas mil For example, if the organization received a payment termed rent that is in fact a return of profits by a person operating the property for the benefit of the organization, or that is a share of the profits retained by the organization as a partner or joint venturer, the payment is not within the income exclusion for rents, discussed later under Exclusions. Https mypay dfas mil Income Generally, unrelated business income is taxable, but there are exclusions and special rules that must be considered when figuring the income. Https mypay dfas mil Exclusions The following types of income (and deductions directly connected with the income) are generally excluded when figuring unrelated business taxable income. Https mypay dfas mil Dividends, interest, annuities and other investment income. Https mypay dfas mil   All dividends, interest, annuities, payments with respect to securities loans, income from notional principal contracts, and other income from an exempt organization's ordinary and routine investments that the IRS determines are substantially similar to these types of income are excluded in computing unrelated business taxable income. Https mypay dfas mil Exception for insurance activity income of a controlled foreign corporation. Https mypay dfas mil   This exclusion does not apply to income from certain insurance activities of an exempt organization's controlled foreign corporation. Https mypay dfas mil The income is not excludable dividend income, but instead is unrelated business taxable income to the extent it would be so treated if the exempt organization had earned it directly. Https mypay dfas mil Certain exceptions to this rule apply. Https mypay dfas mil For more information, see section 512(b)(17). Https mypay dfas mil Other exceptions. Https mypay dfas mil   This exclusion does not apply to unrelated debt-financed income (discussed under Income From Debt-Financed Property, later), to interest or annuities received from a controlled corporation (discussed under Income From Controlled Organizations, later). Https mypay dfas mil Income from lending securities. Https mypay dfas mil   Payments received with respect to a security loan are excluded in computing unrelated business taxable income only if the loan is made under an agreement that:    Provides for the return to the exempt organization of securities identical to the securities loaned, Requires payments to the organization of amounts equivalent to all interest, dividends, and other distributions that the owner of the securities is entitled to receive during the period of the loan, Does not reduce the organization's risk of loss or opportunity for gain on the securities, Contains reasonable procedures to implement the obligation of the borrower to furnish collateral to the organization with a fair market value each business day during the period of the loan in an amount not less than the fair market value of the securities at the close of the preceding business day, and Permits the organization to terminate the loan upon notice of not more than 5 business days. Https mypay dfas mil   Payments with respect to securities loans include: Amounts in respect of dividends, interest, and other distributions, Fees based on the period of time the loan is in effect and the fair market value of the security during that period, Income from collateral security for the loan, and Income from the investment of collateral security. Https mypay dfas mil The payments are considered to be from the securities loaned and not from collateral security or the investment of collateral security from the loans. Https mypay dfas mil Any deductions that are directly connected with collateral security for the loan, or with the investment of collateral security, are considered deductions that are directly connected with the securities loaned. Https mypay dfas mil Royalties. Https mypay dfas mil   Royalties, including overriding royalties, are excluded in computing unrelated business taxable income. Https mypay dfas mil   To be considered a royalty, a payment must relate to the use of a valuable right. Https mypay dfas mil Payments for trademarks, trade names, or copyrights are ordinarily considered royalties. Https mypay dfas mil Similarly, payments for the use of a professional athlete's name, photograph, likeness, or facsimile signature are ordinarily considered royalties. Https mypay dfas mil However, royalties do not include payments for personal services. Https mypay dfas mil Therefore, payments for personal appearances and interviews are not excluded as royalties and must be included in figuring unrelated business taxable income. Https mypay dfas mil   Unrelated business taxable income does not include royalty income received from licensees by an exempt organization that is the legal and beneficial owner of patents assigned to it by inventors for specified percentages of future royalties. Https mypay dfas mil   Mineral royalties are excluded whether measured by production or by gross or taxable income from the mineral property. Https mypay dfas mil However, the exclusion does not apply to royalties that stem from an arrangement whereby the organization owns a working interest in a mineral property and is liable for its share of the development and operating costs under the terms of its agreement with the operator of the property. Https mypay dfas mil To the extent they are not treated as loans under section 636 (relating to income tax treatment of mineral production payments), payments for mineral production are treated in the same manner as royalty payments for the purpose of computing unrelated business taxable income. Https mypay dfas mil To the extent they are treated as loans, any payments for production that are the equivalent of interest are treated as interest and are excluded. Https mypay dfas mil Exceptions. Https mypay dfas mil   This exclusion does not apply to debt-financed income (discussed under Income From Debt-Financed Property, later) or to royalties received from a controlled corporation (discussed under Income From Controlled Organizations, later). Https mypay dfas mil Rents. Https mypay dfas mil   Rents from real property, including elevators and escalators, are excluded in computing unrelated business taxable income. Https mypay dfas mil Rents from personal property are not excluded. Https mypay dfas mil However, special rules apply to “mixed leases” of both real and personal property. Https mypay dfas mil Mixed leases. Https mypay dfas mil   In a mixed lease, all of the rents are excluded if the rents attributable to the personal property are not more than 10% of the total rents under the lease, as determined when the personal property is first placed in service by the lessee. Https mypay dfas mil If the rents attributable to personal property are more than 10% but not more than 50% of the total rents, only the rents attributable to the real property are excluded. Https mypay dfas mil If the rents attributable to the personal property are more than 50% of the total rents, none of the rents are excludable. Https mypay dfas mil   Property is placed in service when the lessee first may use it under the terms of a lease. Https mypay dfas mil For example, property subject to a lease entered into on November 1, for a term starting on January 1 of the next year, is considered placed in service on January 1, regardless of when the lessee first actually uses it. Https mypay dfas mil   If separate leases are entered into for real and personal property and the properties have an integrated use (for example, one or more leases for real property and another lease or leases for personal property to be used on the real property), all the leases will be considered as one lease. Https mypay dfas mil   The rent attributable to the personal property must be recomputed, and the treatment of the rents must be redetermined, if: The rent attributable to all the leased personal property increases by 100% or more because additional or substitute personal property is placed in service, or The lease is modified to change the rent charged (whether or not the amount of rented personal property changes). Https mypay dfas mil Any change in the treatment of rents resulting from the recomputation is effective only for the period beginning with the event that caused the recomputation. Https mypay dfas mil Exception for rents based on net profit. Https mypay dfas mil   The exclusion for rents does not apply if the amount of the rent depends on the income or profits derived by any person from the leased property, other than an amount based on a fixed percentage of the gross receipts or sales. Https mypay dfas mil Exception for income from personal services. Https mypay dfas mil   Payment for occupying space when personal services are also rendered to the occupant does not constitute rent from real property. Https mypay dfas mil Therefore, the exclusion does not apply to transactions such as renting hotel rooms, rooms in boarding houses or tourist homes, and space in parking lots or warehouses. Https mypay dfas mil Other exceptions. Https mypay dfas mil   This exclusion does not apply to unrelated debt-financed income (discussed under Income From Debt-Financed Property, later), or to interest, annuities, royalties and rents received from a controlled corporation (discussed under Income From Controlled Organizations, later), investment income (dividends, interest, rents, etc. Https mypay dfas mil ) received by organizations described in sections 501(c)(7), 501(c)(9), 501(c)(17), and 501(c)(20). Https mypay dfas mil See Special Rules for Social Clubs, VEBAs, SUBs, and GLSOs, discussed later for more information. Https mypay dfas mil Income from research. Https mypay dfas mil   A tax-exempt organization may exclude income from research grants or contracts from unrelated business taxable income. Https mypay dfas mil However, the extent of the exclusion depends on the nature of the organization and the type of research. Https mypay dfas mil   Income from research for the United States, any of its agencies or instrumentalities, or a state or any of its political subdivisions is excluded when computing unrelated business taxable income. Https mypay dfas mil   For a college, university, or hospital, all income from research, whether fundamental or applied, is excluded in computing unrelated business taxable income. Https mypay dfas mil   When an organization is operated primarily to conduct fundamental research (as distinguished from applied research) and the results are freely available to the general public, all income from research performed for any person is excluded in computing unrelated business taxable income. Https mypay dfas mil   The term research, for this purpose, does not include activities of a type normally conducted as an incident to commercial or industrial operations, such as testing or inspecting materials or products, or designing or constructing equipment, buildings, etc. Https mypay dfas mil In addition, the term fundamental research does not include research conducted for the primary purpose of commercial or industrial application. Https mypay dfas mil Gains and losses from disposition of property. Https mypay dfas mil   Also excluded from unrelated business taxable income are gains or losses from the sale, exchange, or other disposition of property other than: Stock in trade or other property of a kind that would properly be includable in inventory if on hand at the close of the tax year, Property held primarily for sale to customers in the ordinary course of a trade or business, or Cutting of timber that an organization has elected to consider as a sale or exchange of the timber. Https mypay dfas mil   It should be noted that the last exception relates only to cut timber. Https mypay dfas mil The sale, exchange, or other disposition of standing timber is excluded from the computation of unrelated business income, unless it constitutes property held for sale to customers in the ordinary course of business. Https mypay dfas mil Lapse or termination of options. Https mypay dfas mil   Any gain from the lapse or termination of options to buy or sell securities is excluded from unrelated business taxable income. Https mypay dfas mil The exclusion applies only if the option is written in connection with the exempt organization's investment activities. Https mypay dfas mil Therefore, this exclusion is not available if the organization is engaged in the trade or business of writing options or the options are held by the organization as inventory or for sale to customers in the ordinary course of a trade or business. Https mypay dfas mil Exception. Https mypay dfas mil   This exclusion does not apply to unrelated debt-financed income, discussed later under Income From Debt-Financed Property. Https mypay dfas mil Gain or loss on disposition of certain brownfield property. Https mypay dfas mil   Gain or loss from the qualifying sale, exchange, or other disposition of a qualifying brownfield property (as defined in section 512(b)(19)(C)), which was acquired by the organization after December 31, 2005 and before January 1, 2011, is excluded from unrelated business taxable income and is excepted from the debt-financed rules for such property. Https mypay dfas mil See sections 512(b)(19) and 514(b)(1)(E). Https mypay dfas mil Income from services provided under federal license. Https mypay dfas mil   There is a further exclusion from unrelated business taxable income of income from a trade or business conducted by a religious order or by an educational organization maintained by the order. Https mypay dfas mil   This exclusion applies only if the following requirements are met. Https mypay dfas mil The trade or business must have been operated by the order or by the institution before May 27, 1959. Https mypay dfas mil The trade or business must provide services under a license issued by a federal regulatory agency. Https mypay dfas mil More than 90% of the net income from the business for the tax year must be devoted to religious, charitable, or educational purposes that constitute the basis for the religious order's exemption. Https mypay dfas mil The rates or other charges for these services must be fully competitive with the rates or other charges of similar taxable businesses. Https mypay dfas mil Rates or other charges for these services will be considered as fully competitive if they are neither materially higher nor materially lower than the rates charged by similar businesses operating in the same general area. Https mypay dfas mil Exception. Https mypay dfas mil    This exclusion does not apply to unrelated debt-financed income (discussed under Income From Debt-Financed Property, later). Https mypay dfas mil Member income of mutual or cooperative electric companies. Https mypay dfas mil   Income of a mutual or cooperative electric company described in section 501(c)(12) which is treated as member income under subparagraph (H) of that section is excluded from unrelated business taxable income. Https mypay dfas mil Dues of Agricultural Organizations and Business Leagues Dues received from associate members by organizations exempt under section 501(c)(5) or section 501(c)(6) may be treated as gross income from an unrelated trade or business if the associate member category exists for the principal purpose of producing unrelated business income. Https mypay dfas mil For example, if an organization creates an associate member category solely to allow associate members to purchase insurance through the organization, the associate member dues may be unrelated business income. Https mypay dfas mil Exception. Https mypay dfas mil   Associate member dues received by an agricultural or horticultural organization are not treated as gross income from an unrelated trade or business, regardless of their purpose, if they are not more than the annual limit. Https mypay dfas mil The limit on dues paid by an associate member is $148 for 2011. Https mypay dfas mil   If the required annual dues are more than the limit, the entire amount is treated as income from an unrelated business unless the associate member category was formed or availed of for the principal purpose of furthering the organization's exempt purposes. Https mypay dfas mil Deductions To qualify as allowable deductions in computing unrelated business taxable income, the expenses, depreciation, and similar items generally must be allowable income tax deductions that are directly connected with carrying on an unrelated trade or business. Https mypay dfas mil They cannot be directly connected with excluded income. Https mypay dfas mil For an exception to the “directly connected” requirement, see Charitable contributions deduction, under Modifications, later. Https mypay dfas mil Directly Connected To be directly connected with the conduct of an unrelated business, deductions must have a proximate and primary relationship to carrying on that business. Https mypay dfas mil For an exception, see Expenses attributable to exploitation of exempt activities, later. Https mypay dfas mil Expenses attributable solely to unrelated business. Https mypay dfas mil   Expenses, depreciation, and similar items attributable solely to the conduct of an unrelated business are proximately and primarily related to that business and qualify for deduction to the extent that they are otherwise allowable income tax deductions. Https mypay dfas mil   For example, salaries of personnel employed full-time to conduct the unrelated business and depreciation of a building used entirely in the conduct of that business are deductible to the extent otherwise allowable. Https mypay dfas mil Expenses attributable to dual use of facilities or personnel. Https mypay dfas mil   When facilities or personnel are used both to conduct exempt functions and to conduct an unrelated trade or business, expenses, depreciation, and similar items attributable to the facilities or personnel must be allocated between the two uses on a reasonable basis. Https mypay dfas mil The part of an item allocated to the unrelated trade or business is proximately and primarily related to that business and is allowable as a deduction in computing unrelated business taxable income if the expense is otherwise an allowable income tax deduction. Https mypay dfas mil Example 1. Https mypay dfas mil A school recognized as a tax-exempt organization contracts with an individual to conduct a summer tennis camp. Https mypay dfas mil The school provides the tennis courts, housing, and dining facilities. Https mypay dfas mil The contracted individual hires the instructors, recruits campers, and provides supervision. Https mypay dfas mil The income the school receives from this activity is from a dual use of the facilities and personnel. Https mypay dfas mil The school, in computing its unrelated business taxable income, may deduct an allocable part of the expenses attributable to the facilities and personnel. Https mypay dfas mil Example 2. Https mypay dfas mil An exempt organization with gross income from an unrelated trade or business pays its president $90,000 a year. Https mypay dfas mil The president devotes approximately 10% of his time to the unrelated business. Https mypay dfas mil To figure the organization's unrelated business taxable income, a deduction of $9,000 ($90,000 × 10%) is allowed for the salary paid to its president. Https mypay dfas mil Expenses attributable to exploitation of exempt activities. Https mypay dfas mil   Generally, expenses, depreciation, and similar items attributable to the conduct of an exempt activity are not deductible in computing unrelated business taxable income from an unrelated trade or business that exploits the exempt activity. Https mypay dfas mil (See Exploitation of exempt functions under Not substantially related in chapter 3. Https mypay dfas mil ) This is because they do not have a proximate and primary relationship to the unrelated trade or business, and therefore, they do not qualify as directly connected with that business. Https mypay dfas mil Exception. Https mypay dfas mil   Expenses, depreciation, and similar items may be treated as directly connected with the conduct of the unrelated business if all the following statements are true. Https mypay dfas mil The unrelated business exploits the exempt activity. Https mypay dfas mil The unrelated business is a type normally conducted for profit by taxable organizations. Https mypay dfas mil The exempt activity is a type normally conducted by taxable organizations in carrying on that type of business. Https mypay dfas mil The amount treated as directly connected is the smaller of: The excess of these expenses, depreciation, and similar items over the income from, or attributable to, the exempt activity; or The gross unrelated business income reduced by all other expenses, depreciation, and other items that are actually directly connected. Https mypay dfas mil   The application of these rules to an advertising activity that exploits an exempt publishing activity is explained next. Https mypay dfas mil Exploitation of Exempt Activity—Advertising Sales The sale of advertising in a periodical of an exempt organization that contains editorial material related to the accomplishment of the organization's exempt purpose is an unrelated business that exploits an exempt activity, the circulation and readership of the periodical. Https mypay dfas mil Therefore, in addition to direct advertising costs, exempt activity costs (expenses, depreciation, and similar expenses attributable to the production and distribution of the editorial or readership content) can be treated as directly connected with the conduct of the advertising activity. Https mypay dfas mil (See Expenses attributable to exploitation of exempt activities under Directly Connected, earlier. Https mypay dfas mil ) Figuring unrelated business taxable income (UBTI). Https mypay dfas mil   The UBTI of an advertising activity is the amount shown in the following chart. Https mypay dfas mil IF gross advertising income is . Https mypay dfas mil . Https mypay dfas mil . Https mypay dfas mil THEN UBTI is . Https mypay dfas mil . Https mypay dfas mil . Https mypay dfas mil More than direct advertising costs The excess advertising income, reduced (but not below zero) by the excess, if any, of readership costs over circulation income. Https mypay dfas mil Equal to or less than direct advertising costs Zero. Https mypay dfas mil   • Circulation income and readership costs are not taken into account. Https mypay dfas mil   • Any excess advertising costs reduce (but not below zero) UBTI from any other unrelated business activity. Https mypay dfas mil   The terms used in the chart are explained in the following discussions. Https mypay dfas mil Periodical Income Gross advertising income. Https mypay dfas mil   This is all the income from the unrelated advertising activities of an exempt organization periodical. Https mypay dfas mil Circulation income. Https mypay dfas mil   This is all the income from the production, distribution, or circulation of an exempt organization's periodical (other than gross advertising income). Https mypay dfas mil It includes all amounts from the sale or distribution of the readership content of the periodical, such as income from subscriptions. Https mypay dfas mil It also includes allocable membership receipts if the right to receive the periodical is associated with a membership or similar status in the organization. Https mypay dfas mil Allocable membership receipts. Https mypay dfas mil   This is the part of membership receipts (dues, fees, or other charges associated with membership) equal to the amount that would have been charged and paid for the periodical if: The periodical was published by a taxable organization, The periodical was published for profit, and The member was an unrelated party dealing with the taxable organization at arm's length. Https mypay dfas mil   The amount used to allocate membership receipts is the amount shown in the following chart. Https mypay dfas mil   For this purpose, the total periodical costs are the sum of the direct advertising costs and the readership costs, explained under Periodical Costs, later. Https mypay dfas mil The cost of other exempt activities means the total expenses incurred by the organization in connection with its other exempt activities, not offset by any income earned by the organization from those activities. Https mypay dfas mil IF . Https mypay dfas mil . Https mypay dfas mil . Https mypay dfas mil THEN the amount used to allocate membership receipts is . Https mypay dfas mil . Https mypay dfas mil . Https mypay dfas mil 20% or more of the total circulation consists of sales to nonmembers The subscription price charged nonmembers. Https mypay dfas mil The above condition does not apply, and 20% or more of the members pay reduced dues because they do not receive the periodical The reduction in dues for a member not receiving the periodical. Https mypay dfas mil Neither of the above conditions applies The membership receipts multiplied by this fraction:   Total periodical costs Total periodical costs Plus Cost of other exempt activities Example 1. Https mypay dfas mil U is an exempt scientific organization with 10,000 members who pay annual dues of $15. Https mypay dfas mil One of U's activities is publishing a monthly periodical distributed to all of its members. Https mypay dfas mil U also distributes 5,000 additional copies of its periodical to nonmembers, who subscribe for $10 a year. Https mypay dfas mil Since the nonmember circulation of U's periodical represents one-third (more than 20%) of its total circulation, the subscription price charged to nonmembers is used to determine the part of U's membership receipts allocable to the periodical. Https mypay dfas mil Thus, U's allocable membership receipts are $100,000 ($10 times 10,000 members), and U's total circulation income for the periodical is $150,000 ($100,000 from members plus $50,000 from sales to nonmembers). Https mypay dfas mil Example 2. Https mypay dfas mil Assume the same facts except that U sells only 500 copies of its periodical to nonmembers, at a price of $10 a year. Https mypay dfas mil Assume also that U's members may elect not to receive the periodical, in which case their dues are reduced from $15 a year to $6 a year, and that only 3,000 members elect to receive the periodical and pay the full dues of $15 a year. Https mypay dfas mil U's stated subscription price of $9 to members consistently results in an excess of total income (including gross advertising income) attributable to the periodical over total costs of the periodical. Https mypay dfas mil Since the 500 copies of the periodical distributed to nonmembers represent only 14% of the 3,500 copies distributed, the $10 subscription price charged to nonmembers is not used to determine the part of membership receipts allocable to the periodical. Https mypay dfas mil Instead, since 70% of the members elect not to receive the periodical and pay $9 less per year in dues, the $9 price is used to determine the subscription price charged to members. Https mypay dfas mil Thus, the allocable membership receipts will be $9 a member, or $27,000 ($9 times 3,000 copies). Https mypay dfas mil U's total circulation income is $32,000 ($27,000 plus the $5,000 from nonmember subscriptions). Https mypay dfas mil Periodical Costs Direct advertising costs. Https mypay dfas mil   These are expenses, depreciation, and similar items of deduction directly connected with selling and publishing advertising in the periodical. Https mypay dfas mil   Examples of allowable deductions under this classification include agency commissions and other direct selling costs, such as transportation and travel expenses, office salaries, promotion and research expenses, and office overhead directly connected with the sale of advertising lineage in the periodical. Https mypay dfas mil Also included are other deductions commonly classified as advertising costs under standard account classifications, such as artwork and copy preparation, telephone, telegraph, postage, and similar costs directly connected with advertising. Https mypay dfas mil   In addition, direct advertising costs include the part of mechanical and distribution costs attributable to advertising lineage. Https mypay dfas mil For this purpose, the general account classifications of items includable in mechanical and distribution costs ordinarily employed in business-paper and consumer-publication accounting provide a guide for the computation. Https mypay dfas mil Accordingly, the mechanical and distribution costs include the part of the costs and other expenses of composition, press work, binding, mailing (including paper and wrappers used for mailing), and bulk postage attributable to the advertising lineage of the publication. Https mypay dfas mil   In the absence of specific and detailed records, the part of mechanical and distribution costs attributable to the periodical's advertising lineage can be based on the ratio of advertising lineage to total lineage in the periodical, if this allocation is reasonable. Https mypay dfas mil Readership costs. Https mypay dfas mil   These are all expenses, depreciation, and similar items that are directly connected with the production and distribution of the readership content of the periodical. Https mypay dfas mil Costs partly attributable to other activities. Https mypay dfas mil   Deductions properly attributable to exempt activities other than publishing the periodical may not be allocated to the periodical. Https mypay dfas mil When expenses are attributable both to the periodical and to the organization's other activities, an allocation must be made on a reasonable basis. Https mypay dfas mil The method of allocation will vary with the nature of the item, but once adopted, should be used consistently. Https mypay dfas mil Allocations based on dollar receipts from various exempt activities generally are not reasonable since receipts usually do not accurately reflect the costs associated with specific activities that an exempt organization conducts. Https mypay dfas mil Consolidated Periodicals If an exempt organization publishes more than one periodical to produce income, it may treat all of them (but not less than all) as one in determining unrelated business taxable income from selling advertising. Https mypay dfas mil It treats the gross income from all the periodicals, and the deductions directly connected with them, on a consolidated basis. Https mypay dfas mil Consolidated treatment, once adopted, must be followed consistently and is binding. Https mypay dfas mil This treatment can be changed only with the consent of the Internal Revenue Service. Https mypay dfas mil An exempt organization's periodical is published to produce income if: The periodical generates gross advertising income to the organization equal to at least 25% of its readership costs, and Publishing the periodical is an activity engaged in for profit. Https mypay dfas mil Whether the publication of a periodical is an activity engaged in for profit can be determined only by all the facts and circumstances in each case. Https mypay dfas mil The facts and circumstances must show that the organization carries on the activity for economic profit, although there may not be a profit in a particular year. Https mypay dfas mil For example, if an organization begins publishing a new periodical whose total costs exceed total income in the start-up years because of lack of advertising sales, that does not mean that the organization did not have as its objective an economic profit. Https mypay dfas mil The organization may establish that it had this objective by showing it can reasonably expect advertising sales to increase, so that total income will exceed costs within a reasonable time. Https mypay dfas mil Example. Https mypay dfas mil Y, an exempt trade association, publishes three periodicals that it distributes to its members: a weekly newsletter, a monthly magazine, and a quarterly journal. Https mypay dfas mil Both the monthly magazine and the quarterly journal contain advertising that accounts for gross advertising income equal to more than 25% of their respective readership costs. Https mypay dfas mil Similarly, the total income attributable to each periodical has exceeded the total deductions attributable to each periodical for substantially all the years they have been published. Https mypay dfas mil The newsletter carries no advertising and its annual subscription price is not intended to cover the cost of publication. Https mypay dfas mil The newsletter is a service that Y distributes to all of its members in an effort to keep them informed of changes occurring in the business world. Https mypay dfas mil It is not engaged in for profit. Https mypay dfas mil Under these circumstances, Y may consolidate the income and deductions from the monthly and quarterly journals in computing its unrelated business taxable income. Https mypay dfas mil It may not consolidate the income and deductions from the newsletter with the income and deductions of its other periodicals, since the newsletter is not published for the production of income. Https mypay dfas mil Modifications Net operating loss deduction. Https mypay dfas mil   The net operating loss (NOL) deduction (as provided in section 172) is allowed in computing unrelated business taxable income. Https mypay dfas mil However, the NOL for any tax year, the carrybacks and carryovers of NOLs, and the NOL deduction are determined without taking into account any amount of income or deduction that has been specifically excluded in computing unrelated business taxable income. Https mypay dfas mil For example, a loss from an unrelated trade or business is not diminished because dividend income was received. Https mypay dfas mil   If this were not done, organizations would, in effect, be taxed on their exempt income, since unrelated business losses then would be offset by dividends, interest, and other excluded income. Https mypay dfas mil This would reduce the loss that could be applied against unrelated business income of prior or future tax years. Https mypay dfas mil Therefore, to preserve the immunity of exempt income, all NOL computations are limited to those items of income and deductions that affect the unrelated business taxable income. Https mypay dfas mil   In line with this concept, an NOL carryback or carryover is allowed only from a tax year for which the organization is subject to tax on unrelated business income. Https mypay dfas mil   For example, if an organization just became subject to the tax last year, its NOL for that year is not a carryback to a prior year when it had no unrelated business taxable income, nor is its NOL carryover to succeeding years reduced by the related income of those prior years. Https mypay dfas mil   However, in determining the span of years for which an NOL may be carried back or forward, the tax years for which the organization is not subject to the tax on unrelated business income are counted. Https mypay dfas mil For example, if an organization was subject to the tax for 2009 and had an NOL for that year, the last tax year to which any part of that loss may be carried over is 2029, regardless of whether the organization was subject to the unrelated business income tax in any of the intervening years. Https mypay dfas mil   For more details on the NOL deduction, including property eligible for an extended carryback period, see sections 172 and 1400N, Publication 536, Net Operating Losses (NOLs) for Individuals, Estates, and Trusts, and Publication 4492-B, Information for Affected Taxpayers in the Midwestern Disaster Areas. Https mypay dfas mil Charitable contributions deduction. Https mypay dfas mil   An exempt organization is allowed to deduct its charitable contributions in computing its unrelated business taxable income whether or not the contributions are directly connected with the unrelated business. Https mypay dfas mil   To be deductible, the contribution must be paid to another qualified organization. Https mypay dfas mil For example, an exempt university that operates an unrelated business may deduct a contribution made to another university for educational work, but may not claim a deduction for contributions of amounts spent for carrying out its own educational program. Https mypay dfas mil   For purposes of the deduction, a distribution by a trust made under the trust instrument to a beneficiary, which itself is a qualified organization, is treated the same as a contribution. Https mypay dfas mil Deduction limits. Https mypay dfas mil   An exempt organization that is subject to the unrelated business income tax at corporate rates is allowed a deduction for charitable contributions up to 10% of its unrelated business taxable income computed without regard to the deduction for contributions. Https mypay dfas mil See the Instructions for Form 990-T for more information. Https mypay dfas mil    An exempt trust that is subject to the unrelated business income tax at trust rates generally is allowed a deduction for charitable contributions in the same amounts as allowed for individuals. Https mypay dfas mil However, the limit on the deduction is determined in relation to the trust's unrelated business taxable income computed without regard to the deduction, rather than in relation to adjusted gross income. Https mypay dfas mil   Contributions in excess of the limits just described may be carried over to the next 5 tax years. Https mypay dfas mil A contribution carryover is not allowed, however, to the extent that it increases an NOL carryover. Https mypay dfas mil Suspension of deduction limits for farmers and ranchers. Https mypay dfas mil   The limitations discussed above are temporarily suspended for certain qualified conservation contributions of property used in agriculture or livestock production. Https mypay dfas mil See the Instructions for Form 990-T for details. Https mypay dfas mil Specific deduction. Https mypay dfas mil   In computing unrelated business taxable income, a specific deduction of $1,000 is allowed. Https mypay dfas mil However, the specific deduction is not allowed in computing an NOL or the NOL deduction. Https mypay dfas mil   Generally, the deduction is limited to $1,000 regardless of the number of unrelated businesses in which the organization is engaged. Https mypay dfas mil Exception. Https mypay dfas mil   An exception is provided in the case of a diocese, province of a religious order, or a convention or association of churches that may claim a specific deduction for each parish, individual church, district, or other local unit. Https mypay dfas mil In these cases, the specific deduction for each local unit is limited to the lower of: $1,000, or Gross income derived from an unrelated trade or business regularly conducted by the local unit. Https mypay dfas mil   This exception applies only to parishes, districts, or other local units that are not separate legal entities, but are components of a larger entity (diocese, province, convention, or association) filing Form 990-T. Https mypay dfas mil The parent organization must file a return reporting the unrelated business gross income and related deductions of all units that are not separate legal entities. Https mypay dfas mil The local units cannot file separate returns. Https mypay dfas mil However, each local unit that is separately incorporated must file its own return and cannot include, or be included with, any other entity. Https mypay dfas mil See Title-holding corporations in chapter 1 for a discussion of the only situation in which more than one legal entity may be included on the same Form 990-T. Https mypay dfas mil Example. Https mypay dfas mil X is an association of churches and is divided into local units A, B, C, and D. Https mypay dfas mil Last year, A, B, C, and D derived gross income of, respectively, $1,200, $800, $1,500, and $700 from unrelated businesses that they regularly conduct. Https mypay dfas mil X may claim a specific deduction of $1,000 with respect to A, $800 with respect to B, $1,000 with respect to C, and $700 with respect to D. Https mypay dfas mil Partnership Income or Loss An organization may have unrelated business income or loss as a member of a partnership, rather than through direct business dealings with the public. Https mypay dfas mil If so, it must treat its share of the partnership income or loss as if it had conducted the business activity in its own capacity as a corporation or trust. Https mypay dfas mil No distinction is made between limited and general partners. Https mypay dfas mil The organization is required to notify the partnership of its tax-exempt status. Https mypay dfas mil Thus, if an organization is a member of a partnership regularly engaged in a trade or business that is an unrelated trade or business with respect to the organization, the organization must include in its unrelated business taxable income its share of the partnership's gross income from the unrelated trade or business (whether or not distributed), and the deductions attributable to it. Https mypay dfas mil The partnership income and deductions to be included in the organization's unrelated business taxable income are figured the same way as any income and deductions from an unrelated trade or business conducted directly by the organization. Https mypay dfas mil The partnership is required to provide the organization this information on Schedule K-1. Https mypay dfas mil Example. Https mypay dfas mil An exempt educational organization is a partner in a partnership that operates a factory. Https mypay dfas mil The partnership also holds stock in a corporation. Https mypay dfas mil The exempt organization must include its share of the gross income from operating the factory in its unrelated business taxable income but may exclude its share of any dividends the partnership received from the corporation. Https mypay dfas mil Different tax years. Https mypay dfas mil   If the exempt organization and the partnership of which it is a member have different tax years, the partnership items that enter into the computation of the organization's unrelated business taxable income must be based on the income and deductions of the partnership for the partnership's tax year that ends within or with the organization's tax year. Https mypay dfas mil S Corporation Income or Loss An organization that owns S corporation stock must take into account its share of the S corporation's income, deductions, or losses in figuring unrelated business taxable income, regardless of the actual source or nature of the income, deductions, and losses. Https mypay dfas mil For example, the organization's share of the S corporation's interest and dividend income will be taxable, even though interest and dividends are normally excluded from unrelated business taxable income. Https mypay dfas mil The organization must also take into account its gain or loss on the sale or other disposition of the S corporation stock in figuring unrelated business taxable income. Https mypay dfas mil Special Rules for Foreign Organizations The unrelated business taxable income of a foreign organization exempt from tax under section 501(a) consists of the organization's: Unrelated business taxable income derived from sources within the United States but not effectively connected with the conduct of a trade or business within the United States, and Unrelated business taxable income effectively connected with the conduct of a trade or business within the United States, whether or not this income is derived from sources within the United States. Https mypay dfas mil To determine whether income realized by a foreign organization is derived from sources within the United States or is effectively connected with the conduct of a trade or business within the United States, see sections 861 through 865 and the related regulations. Https mypay dfas mil Special Rules for Social Clubs, VEBAs, SUBs, and GLSOs The following discussion applies to: Social clubs described in section 501(c)(7), Voluntary employees' beneficiary associations (VEBAs) described in section 501(c)(9), Supplemental unemployment compensation benefit trusts (SUBs) described in section 501(c)(17), and Group legal services organizations (GLSOs) described in section 501(c)(20). Https mypay dfas mil These organizations must figure unrelated business taxable income under special rules. Https mypay dfas mil Unlike other exempt organizations, they cannot exclude their investment income (dividends, interest, rents, etc. Https mypay dfas mil ). Https mypay dfas mil (See Exclusions under Income, earlier. Https mypay dfas mil ) Therefore, they are generally subject to unrelated business income tax on this income. Https mypay dfas mil The unrelated business taxable income of these organizations includes all gross income, less deductions directly connected with the production of that income, except that gross income for this purpose does not include exempt function income. Https mypay dfas mil The dividends received by a corporation are not allowed in computing unrelated business taxable income because it is not an expense incurred in the production of income. Https mypay dfas mil Losses from nonexempt activities. Https mypay dfas mil   Losses from nonexempt activities of these organizations cannot be used to offset investment income unless the activities were undertaken with the intent to make a profit. Https mypay dfas mil Example. Https mypay dfas mil A private golf and country club that is a qualified tax-exempt social club has nonexempt function income from interest and from the sale of food and beverages to nonmembers. Https mypay dfas mil The club sells food and beverages as a service to members and their guests rather than for the purpose of making a profit. Https mypay dfas mil Therefore, any loss resulting from sales to nonmembers cannot be used to offset the club's interest income. Https mypay dfas mil Modifications. Https mypay dfas mil   The unrelated business taxable income is modified by any NOL or charitable contributions deduction and by the specific deduction (described earlier under Deductions). Https mypay dfas mil Exempt function income. Https mypay dfas mil   This is gross income from dues, fees, charges or similar items paid by members for goods, facilities, or services to the members or their dependents or guests, to further the organization's exempt purposes. Https mypay dfas mil Exempt function income also includes income set aside for qualified purposes. Https mypay dfas mil Income that is set aside. Https mypay dfas mil   This is income set aside to be used for religious, charitable, scientific, literary, or educational purposes or for the prevention of cruelty to children or animals. Https mypay dfas mil In addition, for a VEBA, SUB, or GLSO, it is income set aside to provide for the payment of life, sick, accident, or other benefits. Https mypay dfas mil   However, any amounts set aside by a VEBA or SUB that exceed the organization's qualified asset account limit (determined under section 419A) are unrelated business income. Https mypay dfas mil Special rules apply to the treatment of existing reserves for post-retirement medical or life insurance benefits. Https mypay dfas mil These rules are explained in section 512(a)(3)(E)(ii). Https mypay dfas mil   Income derived from an unrelated trade or business may not be set aside and therefore cannot be exempt function income. Https mypay dfas mil In addition, any income set aside and later spent for other purposes must be included in unrelated business taxable income. Https mypay dfas mil   Set-aside income is generally excluded from gross income only if it is set aside in the tax year in which it is otherwise includible in gross income. Https mypay dfas mil However, income set aside on or before the date for filing Form 990-T, including extensions of time, may, at the election of the organization, be treated as having been set aside in the tax year for which the return was filed. Https mypay dfas mil The income set aside must have been includible in gross income for that earlier year. Https mypay dfas mil Nonrecognition of gain. Https mypay dfas mil   If the organization sells property used directly in performing an exempt function and purchases other property used directly in performing an exempt function, any gain on the sale is recognized only to the extent that the sales price of the old property exceeds the cost of the new property. Https mypay dfas mil The purchase of the new property must be made within 1 year before the date of sale of the old property or within 3 years after the date of sale. Https mypay dfas mil   This rule also applies to gain from an involuntary conversion of the property resulting from its destruction in whole or in part, theft, seizure, requisition, or condemnation. Https mypay dfas mil Special Rules for Veterans' Organizations Unrelated business taxable income of a veterans' organization that is exempt under section 501(c)(19) does not include the net income from insurance business that is properly set aside. Https mypay dfas mil The organization may set aside income from payments received for life, sick, accident, or health insurance for the organization's members or their dependents for the payment of insurance benefits or reasonable costs of insurance administration, or for use exclusively for religious, charitable, scientific, literary, or educational purposes, or the prevention of cruelty to children or animals. Https mypay dfas mil For details, see section 512(a)(4) and the regulations under that section. Https mypay dfas mil Income From Controlled Organizations The exclusions for interest, annuities, royalties, and rents, explained earlier in this chapter under Income, may not apply to a payment of these items received by a controlling organization from its controlled organization. Https mypay dfas mil The payment is included in the controlling organization's unrelated business taxable income to the extent it reduced the net unrelated income (or increased the net unrelated loss) of the controlled organization. Https mypay dfas mil All deductions of the controlling organization directly connected with the amount included in its unrelated business taxable income are allowed. Https mypay dfas mil Excess qualifying specified payments. Https mypay dfas mil   Excess qualifying specified payments received or accrued from a controlled entity are included in a controlling 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. Https mypay dfas mil Qualifying specified payments means any payments of interest, annuities, royalties, or rents received or accrued from the controlled organization pursuant to a binding written contract in effect on August 17, 2006, or to a contract which is a renewal, under substantially similar terms of a binding written contract in effect on August 17, 2006, and the payments are received or accrued before January 1, 2012. Https mypay dfas mil   If a controlled participant is not required to file a U. Https mypay dfas mil S. Https mypay dfas mil income tax return, the participant must ensure that the copy or copies of the Regulations section 1. Https mypay dfas mil 482-7 Cost Sharing Arrangement Statement and any updates are attached to Schedule M of any Form 5471, Information Return of U. Https mypay dfas mil S. Https mypay dfas mil Persons With Respect To Certain Foreign Corporations, any Form 5472, Information Return of a 25% Foreign-Owned U. Https mypay dfas mil S. Https mypay dfas mil Corporation or a Foreign Corporation Engaged in a U. Https mypay dfas mil S. Https mypay dfas mil Trade or Business, or any Form 8865, Return of U. Https mypay dfas mil S. Https mypay dfas mil Persons With Respect to Certain Foreign Partnerships, filed for that participant. Https mypay dfas mil Addition to tax for valuation misstatements. Https mypay dfas mil   Under section 512(b)(13)(E)(ii), the tax imposed on a controlling organization will be increased by 20 percent of the excess qualifying specified payments that are determined with or without any amendments or supplements, whichever is larger. Https mypay dfas mil See section 512(b)(13)(E)(ii) for more information. Https mypay dfas mil Net unrelated income. Https mypay dfas mil   This is: For an exempt organization, its unrelated business taxable income, or For a nonexempt organization, the part of its taxable income that would be unrelated business taxable income if it were exempt and had the same exempt purposes as the controlling organization. Https mypay dfas mil Net unrelated loss. Https mypay dfas mil   This is: For an exempt organization, its NOL, or For a nonexempt organization, the part of its NOL that would be its NOL if it were exempt and had the same exempt purposes as the controlling organization. Https mypay dfas mil Control. Https mypay dfas mil   An organization is controlled if: For a corporation, the controlling organization owns (by vote or value) more than 50% of the stock, For a partnership, the controlling organization owns more than 50% of the profits or capital interests, or For any other organization, the controlling organization owns more than 50% of the beneficial interest. Https mypay dfas mil For this purpose, constructive ownership of stock (determined under section 318) or other interests is taken into account. Https mypay dfas mil   As a result, an exempt parent organization is treated as controlling any subsidiary in which it holds more than 50% of the voting power or value, whether directly (as in the case of a first-tier subsidiary) or indirectly (as in the case of a second-tier subsidiary). Https mypay dfas mil Income from property financed with qualified 501(c)(3) bonds. Https mypay dfas mil If any part of a 501(c)(3) organization's property financed with qualified 501(c)(3) bonds is used in a trade or business of any person other than a section 501(c)(3) organization or a governmental unit, and such use is not consistent with the requirements for qualified 501(c)(3) bonds under section 145, the section 501(c)(3) organization is considered to have received unrelated business income in the amount of the greater of the actual rental income or the fair rental value of the property for the period it is used. Https mypay dfas mil No deduction is allowed for interest on the private activity bond. Https mypay dfas mil See sections 150(b)(3) and (c) for more information. Https mypay dfas mil Disposition of property received from taxable subsidiary and used in unrelated business. Https mypay dfas mil A taxable 80%-owned subsidiary corporation of one or more tax-exempt entities is generally subject to tax on a distribution in liquidation of its assets to its exempt parent (or parents). Https mypay dfas mil The assets are treated as if sold at fair market value. Https mypay dfas mil Tax-exempt entities include organizations described in sections 501(a), 529, and 115, charitable remainder trusts, U. Https mypay dfas mil S. Https mypay dfas mil and foreign governments, Indian tribal governments, international organizations, and similar non-taxable organizations. Https mypay dfas mil A taxable corporation that transfers substantially all of its assets to a tax-exempt entity in a transaction that otherwise qualifies for nonrecognition treatment must recognize gain on the transaction as if it sold the assets at fair market value. Https mypay dfas mil However, such a transfer is not taxable if it qualifies as a like-kind exchange under section 1031 or an involuntary conversion under section 1033. Https mypay dfas mil In such a case the built-in appreciation is preserved in the replacement property received in the transaction. Https mypay dfas mil A corporation that changes status from taxable to tax-exempt is treated generally as if it transferred all of its assets to a tax-exempt entity immediately before the change in status (thus subjecting it to the tax on a deemed sale for fair market value). Https mypay dfas mil This rule does not apply where the taxable corporation becomes exempt within 3 years of formation, or had previously been exempt and within several years (generally a period of 3 years) regains exemption, unless the principal purpose of the transactions is to avoid the tax on the change in status. Https mypay dfas mil In the transactions described above, the taxable event is deferred for property that the tax-exempt entity immediately uses in an unrelated business. Https mypay dfas mil If the parent later disposes of the property, then any gain (not in excess of the amount not recognized) is included in the parent's unrelated business taxable income. Https mypay dfas mil If there is partial use of the assets in unrelated business, then there is partial recognition of gain or loss. Https mypay dfas mil Property is treated as disposed if the tax-exempt entity no longer uses it in an unrelated business. Https mypay dfas mil Losses on the transfer of assets to a tax-exempt entity are disallowed if part of a plan with a principal purpose of recognizing losses. Https mypay dfas mil Income From Debt-Financed Property Investment income that would otherwise be excluded from an exempt organization's unrelated business taxable income (see Exclusions under Income earlier) must be included to the extent it is derived from debt-financed property. Https mypay dfas mil The amount of income included is proportionate to the debt on the property. Https mypay dfas mil Debt-Financed Property In general, the term “debt-financed property” means any property held to produce income (including gain from its disposition) for which there is an acquisition indebtedness at any time during the tax year (or during the 12-month period before the date of the property's disposal, if it was disposed of during the tax year). Https mypay dfas mil It includes rental real estate, tangible personal property, and corporate stock. Https mypay dfas mil Acquisition Indebtedness For any debt-financed property, acquisition indebtedness is the unpaid amount of debt incurred by an organization: When acquiring or improving the property, Before acquiring or improving the property if the debt would not have been incurred except for the acquisition or improvement, and After acquiring or improving the property if: The debt would not have been incurred except for the acquisition or improvement, and Incurring the debt was reasonably foreseeable when the property was acquired or improved. Https mypay dfas mil The facts and circumstances of each situation determine whether incurring a debt was reasonably foreseeable. Https mypay dfas mil That an organization may not have foreseen the need to incur a debt before acquiring or improving the property does not necessarily mean that incurring the debt later was not reasonably foreseeable. Https mypay dfas mil Example 1. Https mypay dfas mil Y, an exempt scientific organization, mortgages its laboratory to replace working capital used in remodeling an office building that Y rents to an insurance company for nonexempt purposes. Https mypay dfas mil The debt is acquisition indebtedness since the debt, though incurred after the improvement of the office building, would not have been incurred without the improvement, and the debt was reasonably foreseeable when, to make the improvement, Y reduced its working capital below the amount necessary to continue current operations. Https mypay dfas mil Example 2. Https mypay dfas mil X, an exempt organization, forms a partnership with A and B. Https mypay dfas mil The partnership agreement provides that all three partners will share equally in the profits of the partnership, each will invest $3 million, and X will be a limited partner. Https mypay dfas mil X invests $1 million of its own funds in the partnership and $2 million of borrowed funds. Https mypay dfas mil The partnership buys as its sole asset an office building that it leases to the public for nonexempt purposes. Https mypay dfas mil The office building costs the partnership $24 million, of which $15 million is borrowed from Y bank. Https mypay dfas mil The loan is secured by a mortgage on the entire office building. Https mypay dfas mil By agreement with Y bank, X is not personally liable for payment of the mortgage. Https mypay dfas mil X has acquisition indebtedness of $7 million. Https mypay dfas mil This amount is the $2 million debt X incurred in acquiring the partnership interest, plus the $5 million that is X's allocable part of the partnership's debt incurred to buy the office building (one-third of $15 million). Https mypay dfas mil Example 3. Https mypay dfas mil A labor union advanced funds, from existing resources and without any borrowing, to its tax-exempt subsidiary title-holding company. Https mypay dfas mil The subsidiary used the funds to pay a debt owed to a third party that was previously incurred in acquiring two income-producing office buildings. Https mypay dfas mil Neither the union nor the subsidiary has incurred any further debt in acquiring or improving the property. Https mypay dfas mil The union has no outstanding debt on the property. Https mypay dfas mil The subsidiary's debt to the union is represented by a demand note on which the subsidiary makes payments whenever it has the available cash. Https mypay dfas mil The books of the union and the subsidiary list the outstanding debt as interorganizational indebtedness. Https mypay dfas mil Although the subsidiary's books show a debt to the union, it is not the type subject to the debt-financed property rules. Https mypay dfas mil In this situation, the very nature of the title-holding company and the parent-subsidiary relationship shows this debt to be merely a matter of accounting between the two organizations. Https mypay dfas mil Accordingly, the debt is not acquisition indebtedness. Https mypay dfas mil Change in use of property. Https mypay dfas mil   If an organization converts property that is not debt-financed property to a use that results in its treatment as debt-financed property, the outstanding principal debt on the property is thereafter treated as acquisition indebtedness. Https mypay dfas mil Example. Https mypay dfas mil Four years ago a university borrowed funds to acquire an apartment building as housing for married students. Https mypay dfas mil Last year, the university rented the apartment building to the public for nonexempt purposes. Https mypay dfas mil The outstanding principal debt becomes acquisition indebtedness as of the time the building was first rented to the public. Https mypay dfas mil Continued debt. Https mypay dfas mil   If an organization sells property and, without paying off debt that would be acquisition indebtedness if the property were debt-financed property, buys property that is otherwise debt-financed property, the unpaid debt is acquisition indebtedness for the new property. Https mypay dfas mil This is true even if the original property was not debt-financed property. Https mypay dfas mil Example. Https mypay dfas mil To house its administration offices, an exempt organization bought a building using $600,000 of its own funds and $400,000 of borrowed funds secured by a pledge of its securities. Https mypay dfas mil The office building was not debt-financed property. Https mypay dfas mil The organization later sold the building for $1 million without repaying the $400,000 loan. Https mypay dfas mil It used the sale proceeds to buy an apartment building it rents to the general public. Https mypay dfas mil The unpaid debt of $400,000 is acquisition indebtedness with respect to the apartment building. Https mypay dfas mil Property acquired subject to mortgage or lien. Https mypay dfas mil   If property (other than certain gifts, bequests, and devises) is acquired subject to a mortgage, the outstanding principal debt secured by that mortgage is treated as acquisition indebtedness even if the organization did not assume or agree to pay the debt. Https mypay dfas mil Example. Https mypay dfas mil An exempt organization paid $50,000 for real property valued at $150,000 and subject to a $100,000 mortgage. Https mypay dfas mil The $100,000 of outstanding principal debt is acquisition indebtedness, as though the organization had borrowed $100,000 to buy the property. Https mypay dfas mil Liens similar to a mortgage. Https mypay dfas mil   In determining acquisition indebtedness, a lien similar to a mortgage is treated as a mortgage. Https mypay dfas mil A lien is similar to a mortgage if title to property is encumbered by the lien for a creditor's benefit. Https mypay dfas mil However, when state law provides that a lien for taxes or assessments attaches to property before the taxes or assessments become due and payable, the lien is not treated as a mortgage until after the taxes or assessments have become due and payable and the organization has had an opportunity to pay the lien in accordance with state law. Https mypay dfas mil Liens similar to mortgages include (but are not limited to): Deeds of trust, Conditional sales contracts, Chattel mortgages, Security interests under the Uniform Commercial Code, Pledges, Agreements to hold title in escrow, and Liens for taxes or assessments (other than those discussed earlier in this paragraph). Https mypay dfas mil Exception for property acquired by gift, bequest, or devise. Https mypay dfas mil   If property subject to a mortgage is acquired by gift, bequest, or devise, the outstanding principal debt secured by the mortgage is not treated as acquisition indebtedness during the 10-year period following the date the organization receives the property. Https mypay dfas mil However, this applies to a gift of property only if:    The mortgage was placed on the property more than 5 years before the date the organization received it, and The donor held the property for more than 5 years before the date the organization received it. Https mypay dfas mil   This exception does not apply if an organization assumes and agrees to pay all or part of the debt secured by the mortgage or makes any payment for the equity in the property owned by the donor or decedent (other than a payment under an annuity obligation excluded from the definition of acquisition indebtedness, discussed under Debt That Is Not Acquisition Indebtedness, later). Https mypay dfas mil   Whether an organization has assumed and agreed to pay all or part of a debt in order to acquire the property is determined by the facts and circumstances of each situation. Https mypay dfas mil Modifying existing debt. Https mypay dfas mil   Extending, renewing, or refinancing an existing debt is considered a continuation of that debt to the extent its outstanding principal does not increase. Https mypay dfas mil When the principal of the modified debt is more than the outstanding principal of the old debt, the excess is treated as a separate debt. Https mypay dfas mil Extension or renewal. Https mypay dfas mil   In general, any modification or substitution of the terms of a debt by an organization is considered an extension or renewal of the original debt, rather than the start of a new one, to the extent that the outstanding principal of the debt does not increase. Https mypay dfas mil   The following are examples of acts resulting in the extension or renewal of a debt: Substituting liens to secure the debt, Substituting obligees whether or not with the organization's consent, Renewing, extending, or accelerating the payment terms of the debt, and Adding, deleting, or substituting sureties or other primary or secondary obligors. Https mypay dfas mil Debt increase. Https mypay dfas mil   If the outstanding principal of a modified debt is more than that of the unmodified debt, and only part of the refinanced debt is acquisition indebtedness, the payments on the refinanced debt must be allocated between the old debt and the excess. Https mypay dfas mil Example. Https mypay dfas mil An organization has an outstanding principal debt of $500,000 that is treated as acquisition indebtedness. Https mypay dfas mil The organization borrows another $100,000, which is not acquisition indebtedness, from the same lender, resulting in a $600,000 note for the total obligation. Https mypay dfas mil A payment of $60,000 on the total obligation would reduce the acquisition indebtedness by $50,000 ($60,000 x $500,000/$600,000) and the excess debt by $10,000. Https mypay dfas mil Debt That Is Not Acquisition Indebtedness Certain debt and obligations are not acquisition indebtedness. Https mypay dfas mil These include the following. Https mypay dfas mil Debts incurred in performing an exempt purpose. Https mypay dfas mil Annuity obligations. Https mypay dfas mil Securities loans. Https mypay dfas mil Real property debts of qualified organizations. Https mypay dfas mil Certain Federal financing. Https mypay dfas mil Debt incurred in performing exempt purpose. Https mypay dfas mil   A debt incurred in performing an exempt purpose is not acquisition indebtedness. Https mypay dfas mil For example, acquisition indebtedness does not include the debt an exempt credit union incurs in accepting deposits from its members or the debt an exempt organization incurs in accepting payments from its members to provide them with insurance, retirement, or other benefits. Https mypay dfas mil Annuity obligation. Https mypay dfas mil   The organization's obligation to pay an annuity is not acquisition indebtedness if the annuity meets all the following requirements. Https mypay dfas mil It must be the sole consideration (other than a mortgage on property acquired by gift, bequest, or devise that meets the exception discussed under Property acquired subject to mortgage or lien, earlier in this chapter) issued in exchange for the property received. Https mypay dfas mil Its present value, at the time of exchange, must be less than 90% of the value of the prior owner's equity in the property received. Https mypay dfas mil It must be payable over the lives of either one or two individuals living when issued. Https mypay dfas mil It must be payable under a contract that: Does not guarantee a minimum nor specify a maximum number of payments, and Does not provide for any adjustment of the amount of the annuity payments based on the income received from the transferred property or any other property. Https mypay dfas mil Example. Https mypay dfas mil X, an exempt organization, receives property valued at $100,000 from donor A, a male age 60. Https mypay dfas mil In return X promises to pay A $6,000 a year for the rest of A's life, with neither a minimum nor maximum number of payments specified. Https mypay dfas mil The amounts paid under the annuity are not dependent on the income derived from the property transferred to X. Https mypay dfas mil The present value of this annuity is $81,156, determined from IRS valuation tables. Https mypay dfas mil Since the value of the annuity is less than 90 percent of A's $100,000 equity in the property transferred and the annuity meets all the other requirements just discussed, the obligation to make annuity payments is not acquisition indebtedness. Https mypay dfas mil Securities loans. Https mypay dfas mil   Acquisition indebtedness does not include an obligation of the exempt organization to return collateral security provided by the borrower of the exempt organization's securities under a securities loan agreement (discussed under Exclusions earlier in this chapter). Https mypay dfas mil This transaction is not treated as the borrowing by the exempt organization of the collateral furnished by the borrower (usually a broker) of the securities. Https mypay dfas mil   However, if the exempt organization incurred debt to buy the loaned securities, any income from the securities (including income from
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Https mypay dfas mil 6. Https mypay dfas mil   Tax Treaty Benefits Table of Contents Topics - This chapter discusses: Useful Items - You may want to see: Purpose of Tax Treaties Common Benefits Competent Authority AssistanceAdditional filing. Https mypay dfas mil Obtaining Copies of Tax Treaties Topics - This chapter discusses: Some common tax treaty benefits, How to get help in certain situations, and How to get copies of tax treaties. Https mypay dfas mil Useful Items - You may want to see: Publication 597 Information on the United States—Canada Income Tax Treaty 901 U. Https mypay dfas mil S. Https mypay dfas mil Tax Treaties See chapter 7 for information about getting these publications. Https mypay dfas mil Purpose of Tax Treaties The United States has tax treaties or conventions with many countries. Https mypay dfas mil See Table 6-1 at the end of this chapter for a list of these countries. Https mypay dfas mil Under these treaties and conventions, citizens and residents of the United States who are subject to taxes imposed by the foreign countries are entitled to certain credits, deductions, exemptions, and reductions in the rate of taxes of those foreign countries. Https mypay dfas mil If a foreign country with which the United States has a treaty imposes a tax on you, you may be entitled to benefits under the treaty. Https mypay dfas mil Treaty benefits generally are available to residents of the United States. Https mypay dfas mil They generally are not available to U. Https mypay dfas mil S. Https mypay dfas mil citizens who do not reside in the United States. Https mypay dfas mil However, certain treaty benefits and safeguards, such as the nondiscrimination provisions, are available to U. Https mypay dfas mil S. Https mypay dfas mil citizens residing in the treaty countries. Https mypay dfas mil U. Https mypay dfas mil S. Https mypay dfas mil citizens residing in a foreign country also may be entitled to benefits under that country's tax treaties with third countries. Https mypay dfas mil Certification of U. Https mypay dfas mil S. Https mypay dfas mil residency. Https mypay dfas mil   Use Form 8802, Application for United States Residency Certification, to request certification of U. Https mypay dfas mil S. Https mypay dfas mil residency for purposes of claiming benefits under a tax treaty. Https mypay dfas mil Certification can be requested for the current and any prior calendar years. Https mypay dfas mil You should examine the specific treaty articles to find if you are entitled to a tax credit, tax exemption, reduced rate of tax, or other treaty benefit or safeguard. Https mypay dfas mil Common Benefits Some common tax treaty benefits are explained below. Https mypay dfas mil The credits, deductions, exemptions, reductions in rate, and other benefits provided by tax treaties are subject to conditions and various restrictions. Https mypay dfas mil Benefits provided by certain treaties are not provided by others. Https mypay dfas mil Personal service income. Https mypay dfas mil If you are a U. Https mypay dfas mil S. Https mypay dfas mil resident who is in a treaty country for a limited number of days in the tax year and you meet certain other requirements, the payment you receive for personal services performed in that country may be exempt from that country's income tax. Https mypay dfas mil Professors and teachers. Https mypay dfas mil If you are a U. Https mypay dfas mil S. Https mypay dfas mil resident, the payment you receive for the first 2 or 3 years that you are teaching or doing research in a treaty country may be exempt from that country's income tax. Https mypay dfas mil Students, trainees, and apprentices. Https mypay dfas mil If you are a U. Https mypay dfas mil S. Https mypay dfas mil resident, amounts you receive from the United States for study, research, or business, professional and technical training may be exempt from a treaty country's income tax. Https mypay dfas mil Some treaties exempt grants, allowances, and awards received from governmental and certain nonprofit organizations. Https mypay dfas mil Also, under certain circumstances, a limited amount of pay received by students, trainees, and apprentices may be exempt from the income tax of many treaty countries. Https mypay dfas mil Pensions and annuities. Https mypay dfas mil If you are a U. Https mypay dfas mil S. Https mypay dfas mil resident, nongovernment pensions and annuities you receive may be exempt from the income tax of treaty countries. Https mypay dfas mil Most treaties contain separate provisions for exempting government pensions and annuities from treaty country income tax, and some treaties provide exemption from the treaty country's income tax for social security payments. Https mypay dfas mil Investment income. Https mypay dfas mil If you are a U. Https mypay dfas mil S. Https mypay dfas mil resident, investment income, such as interest and dividends, that you receive from sources in a treaty country may be exempt from that country's income tax or taxed at a reduced rate. Https mypay dfas mil Several treaties provide exemption for capital gains (other than from sales of real property in most cases) if specified requirements are met. Https mypay dfas mil Tax credit provisions. Https mypay dfas mil If you are a U. Https mypay dfas mil S. Https mypay dfas mil resident who receives income from or owns capital in a foreign country, you may be taxed on that income or capital by both the United States and the treaty country. Https mypay dfas mil Most treaties allow you to take a credit against or deduction from the treaty country's taxes based on the U. Https mypay dfas mil S. Https mypay dfas mil tax on the income. Https mypay dfas mil Nondiscrimination provisions. Https mypay dfas mil Most U. Https mypay dfas mil S. Https mypay dfas mil tax treaties provide that the treaty country cannot discriminate by imposing more burdensome taxes on U. Https mypay dfas mil S. Https mypay dfas mil citizens who are residents of the treaty country than it imposes on its own citizens in the same circumstances. Https mypay dfas mil Saving clauses. Https mypay dfas mil U. Https mypay dfas mil S. Https mypay dfas mil treaties contain saving clauses that provide that the treaties do not affect the U. Https mypay dfas mil S. Https mypay dfas mil taxation of its own citizens and residents. Https mypay dfas mil As a result, U. Https mypay dfas mil S. Https mypay dfas mil citizens and residents generally cannot use the treaty to reduce their U. Https mypay dfas mil S. Https mypay dfas mil tax liability. Https mypay dfas mil However, most treaties provide exceptions to saving clauses that allow certain provisions of the treaty to be claimed by U. Https mypay dfas mil S. Https mypay dfas mil citizens or residents. Https mypay dfas mil It is important that you examine the applicable saving clause to determine if an exception applies. Https mypay dfas mil More information on treaties. Https mypay dfas mil   Publication 901 contains an explanation of treaty provisions that apply to amounts received by teachers, students, workers, and government employees and pensioners who are alien nonresidents or residents of the United States. Https mypay dfas mil Since treaty provisions generally are reciprocal, you usually can substitute “United States” for the name of the treaty country whenever it appears, and vice versa when “U. Https mypay dfas mil S. Https mypay dfas mil ” appears in the treaty exemption discussions in Publication 901. Https mypay dfas mil   Publication 597 contains an explanation of a number of frequently-used provisions of the United States–Canada income tax treaty. Https mypay dfas mil Competent Authority Assistance If you are a U. Https mypay dfas mil S. Https mypay dfas mil citizen or resident alien, you can request assistance from the U. Https mypay dfas mil S. Https mypay dfas mil competent authority if you think that the actions of the United States, a treaty country, or both, cause or will cause a tax situation not intended by the treaty between the two countries. Https mypay dfas mil You should read any treaty articles, including the mutual agreement procedure article, that apply in your situation. Https mypay dfas mil The U. Https mypay dfas mil S. Https mypay dfas mil competent authority cannot consider requests involving countries with which the United States does not have a tax treaty. Https mypay dfas mil Effect of request for assistance. Https mypay dfas mil   If your request provides a basis for competent authority assistance, the U. Https mypay dfas mil S. Https mypay dfas mil competent authority generally will consult with the treaty country competent authority on how to resolve the situation. Https mypay dfas mil How to make your request. Https mypay dfas mil   It is important that you make your request for competent authority consideration as soon as either of the following occurs. Https mypay dfas mil You are denied treaty benefits. Https mypay dfas mil Actions taken by both the United States and the foreign country result in double taxation or will result in taxation not intended by the treaty. Https mypay dfas mil   In addition to making a request for assistance, you should take steps so that any agreement reached by the competent authorities is not barred by administrative, legal, or procedural barriers. Https mypay dfas mil Some of the steps you should consider taking include the following. Https mypay dfas mil Filing a protective claim for credit or refund of U. Https mypay dfas mil S. Https mypay dfas mil taxes. Https mypay dfas mil Delaying the expiration of any period of limitations on the making of a refund or other tax adjustment. Https mypay dfas mil Avoiding the lapse or termination of your right to appeal any tax determination. Https mypay dfas mil Complying with all applicable procedures for invoking competent authority consideration. Https mypay dfas mil Contesting an adjustment or seeking an appropriate correlative adjustment with respect to the U. Https mypay dfas mil S. Https mypay dfas mil or treaty country tax. Https mypay dfas mil Taxpayers can consult with the U. Https mypay dfas mil S. Https mypay dfas mil competent authority to determine whether they need to take protective steps and when any required steps need to be taken. Https mypay dfas mil   The request should contain all essential items of information, including the following items. Https mypay dfas mil A reference to the treaty and the treaty provisions on which the request is based. Https mypay dfas mil The years and amounts involved in both U. Https mypay dfas mil S. Https mypay dfas mil dollars and foreign currency. Https mypay dfas mil A brief description of the issues for which competent authority assistance is requested. Https mypay dfas mil   A complete listing of the information that must be included with the request can be found in Revenue Procedure 2006-54, or its successor. Https mypay dfas mil Revenue Procedure 2006-54 is available at www. Https mypay dfas mil irs. Https mypay dfas mil gov/irb/2006-49_IRB/ar13. Https mypay dfas mil html. Https mypay dfas mil   Also, see Notice 2013-78, which provides proposed updates to the procedures for requesting U. Https mypay dfas mil S. Https mypay dfas mil competent authority assistance under tax treaties. Https mypay dfas mil As noted, Revenue Procedure 2006-54 will be superseded by a revenue procedure to be published in the future. Https mypay dfas mil    Your request for competent authority consideration should be addressed to:   Deputy Commissioner (International) Large Business and International Division Internal Revenue Service 1111 Constitution Avenue, NW Routing M4-365 Washington, DC 20224 Attn: TAIT Additional filing. Https mypay dfas mil   In the case of U. Https mypay dfas mil S. Https mypay dfas mil - initiated adjustments, you also must file a copy of the request with the IRS office where your case is pending. Https mypay dfas mil If the request is filed after the matter has been designated for litigation or while a suit contesting your relevant tax liability is pending in a United States court, a copy of the request, with a separate statement attached identifying the court where the suit is pending and the docket number of the action, also must be filed with the: Office of Associate Chief Counsel (International) Internal Revenue Service 1111 Constitution Avenue, NW Washington, DC 20224 Additional details on the procedures for requesting competent authority assistance are included in Revenue Procedure 2006-54, or its successor. Https mypay dfas mil Obtaining Copies of Tax Treaties Table 6-1 lists those countries with which the United States has income tax treaties. Https mypay dfas mil This table is updated through October 31, 2013. Https mypay dfas mil You can get complete information about treaty provisions from the taxing authority in the country from which you receive income or from the treaty itself. Https mypay dfas mil You can obtain the text of most U. Https mypay dfas mil S. Https mypay dfas mil treaties at IRS. Https mypay dfas mil gov. Https mypay dfas mil You also can request the text of treaties from the Department of Treasury at the following address. Https mypay dfas mil Department of Treasury Office of Business and Public Liaison Rm. Https mypay dfas mil 3411 1500 Pennsylvania Avenue, NW  Washington, DC 20220 If you have questions about a treaty and you are in the United States, Puerto Rico, or the U. Https mypay dfas mil S. Https mypay dfas mil Virgin Islands, you can call the IRS at 1-800-829-1040. Https mypay dfas mil Table 6–1. Https mypay dfas mil List of Tax Treaties (Updated through October 31, 2013) Country Official Text  Symbol1 General  Effective Date Citation Applicable Treasury Explanations  or Treasury Decision (T. Https mypay dfas mil D. Https mypay dfas mil ) Australia TIAS 10773 Dec. Https mypay dfas mil 1, 1983 1986-2 C. Https mypay dfas mil B. Https mypay dfas mil 220 1986-2 C. Https mypay dfas mil B. Https mypay dfas mil 246 Protocol TIAS Jan. Https mypay dfas mil 1, 2004     Austria TIAS Jan. Https mypay dfas mil 1, 1999     Bangladesh TIAS Jan. Https mypay dfas mil 1, 2007     Barbados TIAS 11090 Jan. Https mypay dfas mil 1, 1984 1991-2 C. Https mypay dfas mil B. Https mypay dfas mil 436 1991-2 C. Https mypay dfas mil B. Https mypay dfas mil 466 Protocol TIAS Jan. Https mypay dfas mil 1, 2005     Belgium TIAS Jan. Https mypay dfas mil 1, 2008     Bulgaria TIAS Jan. Https mypay dfas mil 1, 2009     Canada2 TIAS 11087 Jan. Https mypay dfas mil 1, 1985 1986-2 C. Https mypay dfas mil B. Https mypay dfas mil 258 1987-2 C. Https mypay dfas mil B. Https mypay dfas mil 298 Protocol TIAS Jan. Https mypay dfas mil 1, 2009     China, People's Republic of TIAS 12065 Jan. Https mypay dfas mil 1, 1987 1988-1 C. Https mypay dfas mil B. Https mypay dfas mil 414 1988-1 C. Https mypay dfas mil B. Https mypay dfas mil 447 Commonwealth of Independent States3 TIAS 8225 Jan. Https mypay dfas mil 1, 1976 1976-2 C. Https mypay dfas mil B. Https mypay dfas mil 463 1976-2 C. Https mypay dfas mil B. Https mypay dfas mil 475 Cyprus TIAS 10965 Jan. Https mypay dfas mil 1, 1986 1989-2 C. Https mypay dfas mil B. Https mypay dfas mil 280 1989-2 C. Https mypay dfas mil B. Https mypay dfas mil 314 Czech Republic TIAS Jan. Https mypay dfas mil 1, 1993     Denmark TIAS Jan. Https mypay dfas mil 1, 2001     Protocol TIAS Jan. Https mypay dfas mil 1, 2008     Egypt TIAS 10149 Jan. Https mypay dfas mil 1, 1982 1982-1 C. Https mypay dfas mil B. Https mypay dfas mil 219 1982-1 C. Https mypay dfas mil B. Https mypay dfas mil 243 Estonia TIAS Jan. Https mypay dfas mil 1, 2000     Finland TIAS 12101 Jan. Https mypay dfas mil 1, 1991     Protocol TIAS Jan. Https mypay dfas mil 1, 2008     France TIAS Jan. Https mypay dfas mil 1, 1996     Protocol TIAS Jan. Https mypay dfas mil 1, 2009     Germany TIAS Jan. Https mypay dfas mil 1, 1990     Protocol TIAS Jan. Https mypay dfas mil 1, 2008     Greece TIAS 2902 Jan. Https mypay dfas mil 1, 1953 1958-2 C. Https mypay dfas mil B. Https mypay dfas mil 1054 T. Https mypay dfas mil D. Https mypay dfas mil 6109, 1954-2 C. Https mypay dfas mil B. Https mypay dfas mil 638 Hungary TIAS 9560 Jan. Https mypay dfas mil 1, 1980 1980-1 C. Https mypay dfas mil B. Https mypay dfas mil 333 1980-1 C. Https mypay dfas mil B. Https mypay dfas mil 354 Iceland TIAS 8151 Jan. Https mypay dfas mil 1, 2009     India TIAS Jan. Https mypay dfas mil 1, 1991     Indonesia TIAS 11593 Jan. Https mypay dfas mil 1, 1990     Ireland TIAS Jan. Https mypay dfas mil 1, 1998     Israel TIAS Jan. Https mypay dfas mil 1, 1995     Italy TIAS Jan. Https mypay dfas mil 1, 2010     Jamaica TIAS 10207 Jan. Https mypay dfas mil 1, 1982 1982-1 C. Https mypay dfas mil B. Https mypay dfas mil 257 1982-1 C. Https mypay dfas mil B. Https mypay dfas mil 291 Japan TIAS Jan. Https mypay dfas mil 1, 2005     Kazakhstan TIAS Jan. Https mypay dfas mil 1, 1996     Korea, South TIAS 9506 Jan. Https mypay dfas mil 1, 1980 1979-2 C. Https mypay dfas mil B. Https mypay dfas mil 435 1979-2 C. Https mypay dfas mil B. Https mypay dfas mil 458 Latvia TIAS Jan. Https mypay dfas mil 1, 2000     Lithuania TIAS Jan. Https mypay dfas mil 1, 2000     Luxembourg TIAS Jan. Https mypay dfas mil 1, 2001     Malta TIAS Jan. Https mypay dfas mil 1, 2011     Mexico TIAS Jan. Https mypay dfas mil 1,1994     Protocol TIAS Jan. Https mypay dfas mil 1, 2004               Table 6–1 (continued). Https mypay dfas mil Country Official Text  Symbol1 General  Effective Date Citation Applicable Treasury Explanations  or Treasury Decision (T. Https mypay dfas mil D. Https mypay dfas mil ) Morocco TIAS 10195 Jan. Https mypay dfas mil 1, 1981 1982-2 C. Https mypay dfas mil B. Https mypay dfas mil 405 1982-2 C. Https mypay dfas mil B. Https mypay dfas mil 427 Netherlands TIAS Jan. Https mypay dfas mil 1, 1994     Protocol TIAS Jan. Https mypay dfas mil 1, 2005     New Zealand TIAS 10772 Nov. Https mypay dfas mil 2, 1983 1990-2 C. Https mypay dfas mil B. Https mypay dfas mil 274 1990-2 C. Https mypay dfas mil B. Https mypay dfas mil 303 Protocol TIAS Jan. Https mypay dfas mil 1, 2011     Norway TIAS 7474 Jan. Https mypay dfas mil 1, 1971 1973-1 C. Https mypay dfas mil B. Https mypay dfas mil 669 1973-1 C. Https mypay dfas mil B. Https mypay dfas mil 693 Protocol TIAS 10205 Jan. Https mypay dfas mil 1, 1982 1982-2 C. Https mypay dfas mil B. Https mypay dfas mil 440 1982-2 C. Https mypay dfas mil B. Https mypay dfas mil 454 Pakistan TIAS 4232 Jan. Https mypay dfas mil 1, 1959 1960-2 C. Https mypay dfas mil B. Https mypay dfas mil 646 T. Https mypay dfas mil D. Https mypay dfas mil 6431, 1960-1 C. Https mypay dfas mil B. Https mypay dfas mil 755 Philippines TIAS 10417 Jan. Https mypay dfas mil 1, 1983 1984-2 C. Https mypay dfas mil B. Https mypay dfas mil 384 1984-2 C. Https mypay dfas mil B. Https mypay dfas mil 412 Poland TIAS 8486 Jan. Https mypay dfas mil 1, 1974 1977-1 C. Https mypay dfas mil B. Https mypay dfas mil 416 1977-1 C. Https mypay dfas mil B. Https mypay dfas mil 427 Portugal TIAS Jan. Https mypay dfas mil 1, 1996     Romania TIAS 8228 Jan. Https mypay dfas mil 1, 1974 1976-2 C. Https mypay dfas mil B. Https mypay dfas mil 492 1976-2 C. Https mypay dfas mil B. Https mypay dfas mil 504 Russia TIAS Jan. Https mypay dfas mil 1, 1994     Slovak Republic TIAS Jan. Https mypay dfas mil 1, 1993     Slovenia TIAS Jan. Https mypay dfas mil 1, 2002     South Africa TIAS Jan. Https mypay dfas mil 1, 1998     Spain TIAS Jan. Https mypay dfas mil 1, 1991     Sri Lanka TIAS Jan. Https mypay dfas mil 1, 2004     Sweden TIAS Jan. Https mypay dfas mil 1, 1996     Protocol TIAS Jan. Https mypay dfas mil 1, 2007     Switzerland TIAS Jan. Https mypay dfas mil 1, 1998     Thailand TIAS Jan. Https mypay dfas mil 1, 1998     Trinidad and Tobago TIAS 7047 Jan. Https mypay dfas mil 1, 1970 1971-2 C. Https mypay dfas mil B. Https mypay dfas mil 479   Tunisia TIAS Jan. Https mypay dfas mil 1, 1990     Turkey TIAS Jan. Https mypay dfas mil 1, 1998     Ukraine TIAS Jan. Https mypay dfas mil 1, 2001     United Kingdom TIAS Jan. Https mypay dfas mil 1, 2004     Venezuela TIAS Jan. Https mypay dfas mil 1, 2000      1(TIAS) — Treaties and Other International Act Series. Https mypay dfas mil  2Information on the treaty can be found in Publication 597, Information on the United States—Canada Income Tax Treaty. Https mypay dfas mil 3The U. Https mypay dfas mil S. Https mypay dfas mil -U. Https mypay dfas mil S. Https mypay dfas mil S. Https mypay dfas mil R. Https mypay dfas mil income tax treaty applies to the countries of Armenia, Azerbaijan, Belarus, Georgia, Kyrgyzstan, Moldova, Tajikistan, Turkmenistan, and Uzbekistan. Https mypay dfas mil Prev  Up  Next   Home   More Online Publications