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Irs 2012 1040 Tax Forms

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Irs 2012 1040 Tax Forms

Irs 2012 1040 tax forms 6. Irs 2012 1040 tax forms   How To Get Tax Help Table of Contents Whether it's help with a tax issue, preparing your tax return or a need for a free publication or form, get the help you need the way you want it: online, use a smart phone, call or walk in to an IRS office or volunteer site near you. Irs 2012 1040 tax forms Free help with your tax return. Irs 2012 1040 tax forms   You can get free help preparing your return nationwide from IRS-certified volunteers. Irs 2012 1040 tax forms The Volunteer Income Tax Assistance (VITA) program helps low-to-moderate income, elderly, people with disabilities, and limited English proficient taxpayers. Irs 2012 1040 tax forms The Tax Counseling for the Elderly (TCE) program helps taxpayers age 60 and older with their tax returns. Irs 2012 1040 tax forms Most VITA and TCE sites offer free electronic filing and all volunteers will let you know about credits and deductions you may be entitled to claim. Irs 2012 1040 tax forms In addition, some VITA and TCE sites provide taxpayers the opportunity to prepare their own return with help from an IRS-certified volunteer. Irs 2012 1040 tax forms To find the nearest VITA or TCE site, you can use the VITA Locator Tool on IRS. Irs 2012 1040 tax forms gov, download the IRS2Go app, or call 1-800-906-9887. Irs 2012 1040 tax forms   As part of the TCE program, AARP offers the Tax-Aide counseling program. Irs 2012 1040 tax forms To find the nearest AARP Tax-Aide site, visit AARP's website at www. Irs 2012 1040 tax forms aarp. Irs 2012 1040 tax forms org/money/taxaide or call 1-888-227-7669. Irs 2012 1040 tax forms For more information on these programs, go to IRS. Irs 2012 1040 tax forms gov and enter “VITA” in the search box. Irs 2012 1040 tax forms Internet. Irs 2012 1040 tax forms    IRS. Irs 2012 1040 tax forms gov and IRS2Go are ready when you are —24 hours a day, 7 days a week. Irs 2012 1040 tax forms Download the free IRS2Go app from the iTunes app store or from Google Play. Irs 2012 1040 tax forms Use it to check your refund status, order transcripts of your tax returns or tax account, watch the IRS YouTube channel, get IRS news as soon as it's released to the public, subscribe to filing season updates or daily tax tips, and follow the IRS Twitter news feed, @IRSnews, to get the latest federal tax news, including information about tax law changes and important IRS programs. Irs 2012 1040 tax forms Check the status of your 2013 refund with the Where's My Refund? application on IRS. Irs 2012 1040 tax forms gov or download the IRS2Go app and select the Refund Status option. Irs 2012 1040 tax forms The IRS issues more than 9 out of 10 refunds in less than 21 days. Irs 2012 1040 tax forms Using these applications, you can start checking on the status of your return within 24 hours after we receive your e-filed return or 4 weeks after you mail a paper return. Irs 2012 1040 tax forms You will also be given a personalized refund date as soon as the IRS processes your tax return and approves your refund. Irs 2012 1040 tax forms The IRS updates Where's My Refund? every 24 hours, usually overnight, so you only need to check once a day. Irs 2012 1040 tax forms Use the Interactive Tax Assistant (ITA) to research your tax questions. Irs 2012 1040 tax forms No need to wait on the phone or stand in line. Irs 2012 1040 tax forms The ITA is available 24 hours a day, 7 days a week, and provides you with a variety of tax information related to general filing topics, deductions, credits, and income. Irs 2012 1040 tax forms When you reach the response screen, you can print the entire interview and the final response for your records. Irs 2012 1040 tax forms New subject areas are added on a regular basis. Irs 2012 1040 tax forms  Answers not provided through ITA may be found in Tax Trails, one of the Tax Topics on IRS. Irs 2012 1040 tax forms gov which contain general individual and business tax information or by searching the IRS Tax Map, which includes an international subject index. Irs 2012 1040 tax forms You can use the IRS Tax Map, to search publications and instructions by topic or keyword. Irs 2012 1040 tax forms The IRS Tax Map integrates forms and publications into one research tool and provides single-point access to tax law information by subject. Irs 2012 1040 tax forms When the user searches the IRS Tax Map, they will be provided with links to related content in existing IRS publications, forms and instructions, questions and answers, and Tax Topics. Irs 2012 1040 tax forms Coming this filing season, you can immediately view and print for free all 5 types of individual federal tax transcripts (tax returns, tax account, record of account, wage and income statement, and certification of non-filing) using Get Transcript. Irs 2012 1040 tax forms You can also ask the IRS to mail a return or an account transcript to you. Irs 2012 1040 tax forms Only the mail option is available by choosing the Tax Records option on the IRS2Go app by selecting Mail Transcript on IRS. Irs 2012 1040 tax forms gov or by calling 1-800-908-9946. Irs 2012 1040 tax forms Tax return and tax account transcripts are generally available for the current year and the past three years. Irs 2012 1040 tax forms Determine if you are eligible for the EITC and estimate the amount of the credit with the Earned Income Tax Credit (EITC) Assistant. Irs 2012 1040 tax forms Visit Understanding Your IRS Notice or Letter to get answers to questions about a notice or letter you received from the IRS. Irs 2012 1040 tax forms If you received the First Time Homebuyer Credit, you can use the First Time Homebuyer Credit Account Look-up tool for information on your repayments and account balance. Irs 2012 1040 tax forms Check the status of your amended return using Where's My Amended Return? Go to IRS. Irs 2012 1040 tax forms gov and enter Where's My Amended Return? in the search box. Irs 2012 1040 tax forms You can generally expect your amended return to be processed up to 12 weeks from the date we receive it. Irs 2012 1040 tax forms It can take up to 3 weeks from the date you mailed it to show up in our system. Irs 2012 1040 tax forms Make a payment using one of several safe and convenient electronic payment options available on IRS. Irs 2012 1040 tax forms gov. Irs 2012 1040 tax forms Select the Payment tab on the front page of IRS. Irs 2012 1040 tax forms gov for more information. Irs 2012 1040 tax forms Determine if you are eligible and apply for an online payment agreement, if you owe more tax than you can pay today. Irs 2012 1040 tax forms Figure your income tax withholding with the IRS Withholding Calculator on IRS. Irs 2012 1040 tax forms gov. Irs 2012 1040 tax forms Use it if you've had too much or too little withheld, your personal situation has changed, you're starting a new job or you just want to see if you're having the right amount withheld. Irs 2012 1040 tax forms Determine if you might be subject to the Alternative Minimum Tax by using the Alternative Minimum Tax Assistant on IRS. Irs 2012 1040 tax forms gov. Irs 2012 1040 tax forms Request an Electronic Filing PIN by going to IRS. Irs 2012 1040 tax forms gov and entering Electronic Filing PIN in the search box. Irs 2012 1040 tax forms Download forms, instructions and publications, including accessible versions for people with disabilities. Irs 2012 1040 tax forms Locate the nearest Taxpayer Assistance Center (TAC) using the Office Locator tool on IRS. Irs 2012 1040 tax forms gov, or choose the Contact Us option on the IRS2Go app and search Local Offices. Irs 2012 1040 tax forms An employee can answer questions about your tax account or help you set up a payment plan. Irs 2012 1040 tax forms Before you visit, check the Office Locator on IRS. Irs 2012 1040 tax forms gov, or Local Offices under Contact Us on IRS2Go to confirm the address, phone number, days and hours of operation, and the services provided. Irs 2012 1040 tax forms If you have a special need, such as a disability, you can request an appointment. Irs 2012 1040 tax forms Call the local number listed in the Office Locator, or look in the phone book under United States Government, Internal Revenue Service. Irs 2012 1040 tax forms Apply for an Employer Identification Number (EIN). Irs 2012 1040 tax forms Go to IRS. Irs 2012 1040 tax forms gov and enter Apply for an EIN in the search box. Irs 2012 1040 tax forms Read the Internal Revenue Code, regulations, or other official guidance. Irs 2012 1040 tax forms Read Internal Revenue Bulletins. Irs 2012 1040 tax forms Sign up to receive local and national tax news and more by email. Irs 2012 1040 tax forms Just click on “subscriptions” above the search box on IRS. Irs 2012 1040 tax forms gov and choose from a variety of options. Irs 2012 1040 tax forms Phone. Irs 2012 1040 tax forms    You can call the IRS, or you can carry it in your pocket with the IRS2Go app on your smart phone or tablet. Irs 2012 1040 tax forms Download the free IRS2Go app from the iTunes app store or from Google Play. Irs 2012 1040 tax forms Call to locate the nearest volunteer help site, 1-800-906-9887 or you can use the VITA Locator Tool on IRS. Irs 2012 1040 tax forms gov, or download the IRS2Go app. Irs 2012 1040 tax forms Low-to-moderate income, elderly, people with disabilities, and limited English proficient taxpayers can get free help with their tax return from the nationwide Volunteer Income Tax Assistance (VITA) program. Irs 2012 1040 tax forms The Tax Counseling for the Elderly (TCE) program helps taxpayers age 60 and older with their tax returns. Irs 2012 1040 tax forms Most VITA and TCE sites offer free electronic filing. Irs 2012 1040 tax forms Some VITA and TCE sites provide IRS-certified volunteers who can help prepare your tax return. Irs 2012 1040 tax forms Through the TCE program, AARP offers the Tax-Aide counseling program; call 1-888-227-7669 to find the nearest Tax-Aide location. Irs 2012 1040 tax forms Call the automated Where's My Refund? information hotline to check the status of your 2013 refund 24 hours a day, 7 days a week at 1-800-829-1954. Irs 2012 1040 tax forms If you e-file, you can start checking on the status of your return within 24 hours after the IRS receives your tax return or 4 weeks after you've mailed a paper return. Irs 2012 1040 tax forms The IRS issues more than 9 out of 10 refunds in less than 21 days. Irs 2012 1040 tax forms Where's My Refund? will give you a personalized refund date as soon as the IRS processes your tax return and approves your refund. Irs 2012 1040 tax forms Before you call this automated hotline, have your 2013 tax return handy so you can enter your social security number, your filing status, and the exact whole dollar amount of your refund. Irs 2012 1040 tax forms The IRS updates Where's My Refund? every 24 hours, usually overnight, so you only need to check once a day. Irs 2012 1040 tax forms Note, the above information is for our automated hotline. Irs 2012 1040 tax forms Our live phone and walk-in assistors can research the status of your refund only if it's been 21 days or more since you filed electronically or more than 6 weeks since you mailed your paper return. Irs 2012 1040 tax forms Call the Amended Return Hotline, 1-866-464-2050, to check the status of your amended return. Irs 2012 1040 tax forms You can generally expect your amended return to be processed up to 12 weeks from the date we receive it. Irs 2012 1040 tax forms It can take up to 3 weeks from the date you mailed it to show up in our system. Irs 2012 1040 tax forms Call 1-800-TAX-FORM (1-800-829-3676) to order current-year forms, instructions, publications, and prior-year forms and instructions (limited to 5 years). Irs 2012 1040 tax forms You should receive your order within 10 business days. Irs 2012 1040 tax forms Call TeleTax, 1-800-829-4477, to listen to pre-recorded messages covering general and business tax information. Irs 2012 1040 tax forms If, between January and April 15, you still have questions about the Form 1040, 1040A, or 1040EZ (like filing requirements, dependents, credits, Schedule D, pensions and IRAs or self-employment taxes), call 1-800-829-1040. Irs 2012 1040 tax forms Call using TTY/TDD equipment, 1-800-829-4059 to ask tax questions or order forms and publications. Irs 2012 1040 tax forms The TTY/TDD telephone number is for people who are deaf, hard of hearing, or have a speech disability. Irs 2012 1040 tax forms These individuals can also contact the IRS through relay services such as the Federal Relay Service. Irs 2012 1040 tax forms Walk-in. Irs 2012 1040 tax forms   You can find a selection of forms, publications and services — in-person. Irs 2012 1040 tax forms Products. Irs 2012 1040 tax forms You can walk in to some post offices, libraries, and IRS offices to pick up certain forms, instructions, and publications. Irs 2012 1040 tax forms Some IRS offices, libraries, and city and county government offices have a collection of products available to photocopy from reproducible proofs. Irs 2012 1040 tax forms Services. Irs 2012 1040 tax forms You can walk in to your local TAC for face-to-face tax help. Irs 2012 1040 tax forms An employee can answer questions about your tax account or help you set up a payment plan. Irs 2012 1040 tax forms Before visiting, use the Office Locator tool on IRS. Irs 2012 1040 tax forms gov, or choose the Contact Us option on the IRS2Go app and search Local Offices for days and hours of operation, and services provided. Irs 2012 1040 tax forms Mail. Irs 2012 1040 tax forms   You can send your order for forms, instructions, and publications to the address below. Irs 2012 1040 tax forms You should receive a response within 10 business days after your request is received. Irs 2012 1040 tax forms Internal Revenue Service 1201 N. Irs 2012 1040 tax forms Mitsubishi Motorway Bloomington, IL 61705-6613    The Taxpayer Advocate Service Is Here to Help You. Irs 2012 1040 tax forms The Taxpayer Advocate Service (TAS) is your voice at the IRS. Irs 2012 1040 tax forms Our job is to ensure that every taxpayer is treated fairly and that you know and understand your rights. Irs 2012 1040 tax forms   What can TAS do for you? We can offer you free help with IRS problems that you can't resolve on your own. Irs 2012 1040 tax forms We know this process can be confusing, but the worst thing you can do is nothing at all! TAS can help if you can't resolve your tax problem and: Your problem is causing financial difficulties for you, your family, or your business. Irs 2012 1040 tax forms You face (or your business is facing) an immediate threat of adverse action. Irs 2012 1040 tax forms You've tried repeatedly to contact the IRS but no one has responded, or the IRS hasn't responded by the date promised. Irs 2012 1040 tax forms   If you qualify for our help, you'll be assigned to one advocate who'll be with you at every turn and will do everything possible to resolve your problem. Irs 2012 1040 tax forms Here's why we can help: TAS is an independent organization within the IRS. Irs 2012 1040 tax forms Our advocates know how to work with the IRS. Irs 2012 1040 tax forms Our services are free and tailored to meet your needs. Irs 2012 1040 tax forms We have offices in every state, the District of Columbia, and Puerto Rico. Irs 2012 1040 tax forms   How can you reach us? If you think TAS can help you, call your local advocate, whose number is in your local directory and at Taxpayer Advocate, or call us toll-free at 1-877-777-4778. Irs 2012 1040 tax forms   How else does TAS help taxpayers?  TAS also works to resolve large-scale, systemic problems that affect many taxpayers. Irs 2012 1040 tax forms If you know of one of these broad issues, please report it to us through our Systemic Advocacy Management System. Irs 2012 1040 tax forms Low Income Taxpayer Clinics (LITCs). Irs 2012 1040 tax forms   Low Income Taxpayer Clinics (LITCs) serve individuals whose income is below a certain level and need to resolve tax problems such as audits, appeals, and tax collection disputes. Irs 2012 1040 tax forms Some clinics can provide information about taxpayer rights and responsibilities in different languages for individuals who speak English as a second language. Irs 2012 1040 tax forms Visit www. Irs 2012 1040 tax forms TaxpayerAdvocate. Irs 2012 1040 tax forms irs. Irs 2012 1040 tax forms gov or see IRS Publication 4134, Low Income Taxpayer Clinic List. Irs 2012 1040 tax forms Prev  Up  Next   Home   More Online Publications
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The Irs 2012 1040 Tax Forms

Irs 2012 1040 tax forms 3. Irs 2012 1040 tax forms   Unrelated Trade or Business Table of Contents Selling of products of exempt functions. Irs 2012 1040 tax forms Dual use of assets or facilities. Irs 2012 1040 tax forms Exploitation of exempt functions. Irs 2012 1040 tax forms ExamplesExceptions. Irs 2012 1040 tax forms Excluded Trade or Business ActivitiesQualified sponsorship payment. Irs 2012 1040 tax forms Advertising. Irs 2012 1040 tax forms Exception for contingent payments. Irs 2012 1040 tax forms Exception for periodicals. Irs 2012 1040 tax forms Exception for conventions and trade shows. Irs 2012 1040 tax forms Legal definition. Irs 2012 1040 tax forms Legal where played. Irs 2012 1040 tax forms No for-profit games where played. Irs 2012 1040 tax forms Unrelated business income. Irs 2012 1040 tax forms   Unrelated business income is the income from a trade or business regularly conducted by an exempt organization and not substantially related to the performance by the organization of its exempt purpose or function, except that the organization uses the profits derived from this activity. Irs 2012 1040 tax forms   Certain trade or business activities are not treated as an unrelated trade or business. Irs 2012 1040 tax forms See Excluded Trade or Business Activities, later. Irs 2012 1040 tax forms Trade or business. Irs 2012 1040 tax forms   The term “trade or business” generally includes any activity conducted for the production of income from selling goods or performing services. Irs 2012 1040 tax forms An activity does not lose its identity as a trade or business merely because it is conducted within a larger group of similar activities that may or may not be related to the exempt purposes of the organization. Irs 2012 1040 tax forms   For example, the regular sale of pharmaceutical supplies to the general public by a hospital pharmacy does not lose its identity as a trade or business, even though the pharmacy also furnishes supplies to the hospital and patients of the hospital in accordance with its exempt purpose. Irs 2012 1040 tax forms Similarly, soliciting, selling, and publishing commercial advertising is a trade or business even though the advertising is published in an exempt organization's periodical that contains editorial matter related to the organization's exempt purpose. Irs 2012 1040 tax forms Regularly conducted. Irs 2012 1040 tax forms   Business activities of an exempt organization ordinarily are considered regularly conducted if they show a frequency and continuity, and are pursued in a manner similar to comparable commercial activities of nonexempt organizations. Irs 2012 1040 tax forms   For example, a hospital auxiliary's operation of a sandwich stand for 2 weeks at a state fair would not be the regular conduct of a trade or business. Irs 2012 1040 tax forms The stand would not compete with similar facilities that a nonexempt organization would ordinarily operate year-round. Irs 2012 1040 tax forms However, operating a commercial parking lot every Saturday, year-round, would be the regular conduct of a trade or business. Irs 2012 1040 tax forms Not substantially related. Irs 2012 1040 tax forms    A business activity is not substantially related to an organization's exempt purpose if it does not contribute importantly to accomplishing that purpose (other than through the production of funds). Irs 2012 1040 tax forms Whether an activity contributes importantly depends in each case on the facts involved. Irs 2012 1040 tax forms   In determining whether activities contribute importantly to the accomplishment of an exempt purpose, the size and extent of the activities involved must be considered in relation to the nature and extent of the exempt function that they intend to serve. Irs 2012 1040 tax forms For example, to the extent an activity is conducted on a scale larger than is reasonably necessary to perform an exempt purpose, it does not contribute importantly to the accomplishment of the exempt purpose. Irs 2012 1040 tax forms The part of the activity that is more than needed to accomplish the exempt purpose is an unrelated trade or business. Irs 2012 1040 tax forms   Also in determining whether activities contribute importantly to the accomplishment of an exempt purpose, the following principles apply. Irs 2012 1040 tax forms Selling of products of exempt functions. Irs 2012 1040 tax forms   Ordinarily, selling products that result from the performance of exempt functions is not an unrelated trade or business if the product is sold in substantially the same state it is in when the exempt functions are completed. Irs 2012 1040 tax forms Thus, for an exempt organization engaged in rehabilitating handicapped persons (its exempt function), selling articles made by these persons as part of their rehabilitation training is not an unrelated trade or business. Irs 2012 1040 tax forms   However, if a completed product resulting from an exempt function is used or exploited in further business activity beyond what is reasonably appropriate or necessary to dispose of it as is, the activity is an unrelated trade or business. Irs 2012 1040 tax forms For example, if an exempt organization maintains an experimental dairy herd for scientific purposes, the sale of milk and cream produced in the ordinary course of operation of the project is not an unrelated trade or business. Irs 2012 1040 tax forms But if the organization uses the milk and cream in the further manufacture of food items such as ice cream, pastries, etc. Irs 2012 1040 tax forms , the sale of these products is an unrelated trade or business unless the manufacturing activities themselves contribute importantly to the accomplishment of an exempt purpose of the organization. Irs 2012 1040 tax forms Dual use of assets or facilities. Irs 2012 1040 tax forms   If an asset or facility necessary to the conduct of exempt functions is also used in commercial activities, its use for exempt functions does not, by itself, make the commercial activities a related trade or business. Irs 2012 1040 tax forms The test, as discussed earlier, is whether the activities contribute importantly to the accomplishment of exempt purposes. Irs 2012 1040 tax forms   For example, a museum has a theater auditorium designed for showing educational films in connection with its program of public education in the arts and sciences. Irs 2012 1040 tax forms The theater is a principal feature of the museum and operates continuously while the museum is open to the public. Irs 2012 1040 tax forms If the organization also operates the theater as a motion picture theater for the public when the museum is closed, the activity is an unrelated trade or business. Irs 2012 1040 tax forms   For information on allocating expenses for the dual use of assets or facilities, see Deductions in chapter 4. Irs 2012 1040 tax forms Exploitation of exempt functions. Irs 2012 1040 tax forms   Exempt activities sometimes create goodwill or other intangibles that can be exploited in a commercial way. Irs 2012 1040 tax forms When an organization exploits such an intangible in commercial activities, the fact that the income depends in part upon an exempt function of the organization does not make the commercial activities a related trade or business. Irs 2012 1040 tax forms Unless the commercial exploitation contributes importantly to the accomplishment of the exempt purpose, the commercial activities are an unrelated trade or business. Irs 2012 1040 tax forms   For the treatment of expenses attributable to the exploitation of exempt activities, see Deductions in chapter 4. Irs 2012 1040 tax forms Examples The following are examples of activities that were determined to be (or not to be) unrelated trades or businesses using the definitions and principles just discussed. Irs 2012 1040 tax forms Sales commissions. Irs 2012 1040 tax forms   An agricultural organization, whose exempt purposes are to promote better conditions for cattle breeders and to improve the breed generally, engages in an unrelated trade or business when it regularly sells cattle for its members on a commission basis. Irs 2012 1040 tax forms Artists' facilities. Irs 2012 1040 tax forms   An organization whose exempt purpose is to stimulate and foster public interest in the fine arts by promoting art exhibits, sponsoring cultural events, and furnishing information about fine arts leases studio apartments to artist tenants and operates a dining hall primarily for these tenants. Irs 2012 1040 tax forms These two activities do not contribute importantly to accomplishing the organization's exempt purpose. Irs 2012 1040 tax forms Therefore, they are unrelated trades or businesses. Irs 2012 1040 tax forms Membership list sales. Irs 2012 1040 tax forms   An exempt educational organization regularly sells membership mailing lists to business firms. Irs 2012 1040 tax forms This activity does not contribute importantly to the accomplishment of the organization's exempt purpose and therefore is an unrelated trade or business. Irs 2012 1040 tax forms Also see Exchange or rental of member lists under Excluded Trade or Business Activities, later. Irs 2012 1040 tax forms Hospital facilities. Irs 2012 1040 tax forms   An exempt hospital leases its adjacent office building and furnishes certain office services to a hospital-based medical group for a fee. Irs 2012 1040 tax forms The group provides all diagnostic and therapeutic procedures to the hospital's patients and operates the hospital's emergency room on a 24-hour basis. Irs 2012 1040 tax forms The leasing activity is substantially related to the hospital's exempt purpose and is not an unrelated trade or business. Irs 2012 1040 tax forms   The hospital also operates a gift shop patronized by patients, visitors making purchases for patients, and employees; a cafeteria and coffee shop primarily for employees and medical staff; and a parking lot for patients and visitors only. Irs 2012 1040 tax forms These activities are also substantially related to the hospital's exempt purpose and do not constitute unrelated trades or businesses. Irs 2012 1040 tax forms Book publishing. Irs 2012 1040 tax forms   An exempt organization engages primarily in activities that further its exempt purposes. Irs 2012 1040 tax forms It also owns the publication rights to a book that does not relate to any of its exempt purposes. Irs 2012 1040 tax forms The organization exploits the book in a commercial manner by arranging for printing, distribution, publicity, and advertising in connection with the sale of the book. Irs 2012 1040 tax forms These activities constitute a trade or business regularly conducted. Irs 2012 1040 tax forms Because exploiting the book is unrelated to the organization's exempt purposes (except for the use of the book's profits), the income is unrelated business income. Irs 2012 1040 tax forms   However, if the organization transfers publication rights to a commercial publisher in return for royalties, the royalty income received will not be unrelated business income. Irs 2012 1040 tax forms See Royalties under Exclusions in chapter 4. Irs 2012 1040 tax forms School handicraft shop. Irs 2012 1040 tax forms   An exempt vocational school operates a handicraft shop that sells articles made by students in their regular courses of instruction. Irs 2012 1040 tax forms The students are paid a percentage of the sales price. Irs 2012 1040 tax forms In addition, the shop sells products made by local residents who make articles at home according to the shop's specifications. Irs 2012 1040 tax forms The shop manager periodically inspects the articles during their manufacture to ensure that they meet desired standards of style and quality. Irs 2012 1040 tax forms Although many local participants are former students of the school, any qualified person may participate in the program. Irs 2012 1040 tax forms The sale of articles made by students does not constitute an unrelated trade or business, but the sale of products made by local residents is an unrelated trade or business and is subject to unrelated business income tax. Irs 2012 1040 tax forms School facilities. Irs 2012 1040 tax forms   An exempt school has tennis courts and dressing rooms that it uses during the regular school year in its educational program. Irs 2012 1040 tax forms During the summer, the school operates a tennis club open to the general public. Irs 2012 1040 tax forms Employees of the school run the club, including collecting membership fees and scheduling court time. Irs 2012 1040 tax forms   Another exempt school leases the same type of facilities to an unrelated individual who runs a tennis club for the summer. Irs 2012 1040 tax forms The lease is for a fixed fee that does not depend on the income or profits derived from the leased property. Irs 2012 1040 tax forms   In both situations, the exempt purpose is the advancement of education. Irs 2012 1040 tax forms Furnishing tennis facilities in the manner described does not further that exempt purpose. Irs 2012 1040 tax forms These activities are unrelated trades or businesses. Irs 2012 1040 tax forms However, in the second situation the income derived from the leasing of the property is excluded from unrelated business taxable income as rent from real property. Irs 2012 1040 tax forms See Rents under Exclusions in chapter 4. Irs 2012 1040 tax forms Services provided with lease. Irs 2012 1040 tax forms   An exempt university leases its football stadium during several months of the year to a professional football team for a fixed fee. Irs 2012 1040 tax forms Under the lease agreement, the university furnishes heat, light, and water and is responsible for all ground maintenance. Irs 2012 1040 tax forms It also provides dressing room, linen, and stadium security services for the professional team. Irs 2012 1040 tax forms   Leasing of the stadium is an unrelated trade or business. Irs 2012 1040 tax forms In addition, the substantial services furnished for the convenience of the lessee go beyond those usually provided with the rental of space for occupancy only. Irs 2012 1040 tax forms Therefore, the income from this lease is rent from real property and unrelated business taxable income. Irs 2012 1040 tax forms Broadcasting rights. Irs 2012 1040 tax forms   An exempt collegiate athletic conference conducts an annual competitive athletic game between its conference champion and another collegiate team. Irs 2012 1040 tax forms Income is derived from admission charges and the sale of exclusive broadcasting rights to a national radio and television network. Irs 2012 1040 tax forms An athletic program is considered an integral part of the educational process of a university. Irs 2012 1040 tax forms   The educational purposes served by intercollegiate athletics are identical whether conducted directly by individual universities or by their regional athletic conference. Irs 2012 1040 tax forms Also, the educational purposes served by exhibiting a game before an audience that is physically present and exhibiting the game on television or radio before a much larger audience are substantially similar. Irs 2012 1040 tax forms Therefore, the sale of the broadcasting rights contributes importantly to the accomplishment of the organization's exempt purpose and is not an unrelated trade or business. Irs 2012 1040 tax forms   In a similar situation, an exempt organization was created as a national governing body for amateur athletes to foster interest in amateur sports and to encourage widespread public participation. Irs 2012 1040 tax forms The organization receives income each year from the sale of exclusive broadcasting rights to an independent producer, who contracts with a commercial network to broadcast many of the athletic events sponsored, supervised, and regulated by the organization. Irs 2012 1040 tax forms   The broadcasting of these events promotes the various amateur sports, fosters widespread public interest in the benefits of the organization's nationwide amateur program, and encourages public participation. Irs 2012 1040 tax forms The sale of the rights and the broadcasting of the events contribute importantly to the organization's exempt purpose. Irs 2012 1040 tax forms Therefore, the sale of the exclusive broadcasting rights is not an unrelated trade or business. Irs 2012 1040 tax forms Yearbook advertising. Irs 2012 1040 tax forms   An exempt organization receives income from the sale of advertising in its annual yearbook. Irs 2012 1040 tax forms The organization hires an independent commercial firm, under a contract covering a full calendar year, to conduct an intensive advertising solicitation campaign in the organization's name. Irs 2012 1040 tax forms This firm is paid a percentage of the gross advertising receipts for selling the advertising, collecting from advertisers, and printing the yearbook. Irs 2012 1040 tax forms This advertising activity is an unrelated trade or business. Irs 2012 1040 tax forms Pet boarding and grooming services. Irs 2012 1040 tax forms   An exempt organization, organized and operated for the prevention of cruelty to animals, receives unrelated business income from providing pet boarding and grooming services for the general public. Irs 2012 1040 tax forms These activities do not contribute importantly to its purpose of preventing cruelty to animals. Irs 2012 1040 tax forms Museum eating facilities. Irs 2012 1040 tax forms   An exempt art museum operates a dining room, a cafeteria, and a snack bar for use by the museum staff, employees, and visitors. Irs 2012 1040 tax forms Eating facilities in the museum help to attract visitors and allow them to spend more time viewing the museum's exhibits without having to seek outside restaurants at mealtime. Irs 2012 1040 tax forms The eating facilities also allow the museum staff and employees to remain in the museum throughout the day. Irs 2012 1040 tax forms Thus, the museum's operation of the eating facilities contributes importantly to the accomplishment of its exempt purposes and is not unrelated trade or business. Irs 2012 1040 tax forms Halfway house workshop. Irs 2012 1040 tax forms   A halfway house organized to provide room, board, therapy, and counseling for persons discharged from alcoholic treatment centers also operates a furniture shop to provide full-time employment for its residents. Irs 2012 1040 tax forms The profits are applied to the operating costs of the halfway house. Irs 2012 1040 tax forms The income from this venture is not unrelated trade or business income because the furniture shop contributes importantly to the organization's purpose of aiding its residents' transition from treatment to a normal and productive life. Irs 2012 1040 tax forms Travel tour programs. Irs 2012 1040 tax forms   Travel tour activities that are a trade or business are an unrelated trade or business if the activities are not substantially related to the purpose for which tax exemption was granted to the organization. Irs 2012 1040 tax forms Example 1. Irs 2012 1040 tax forms A tax-exempt university alumni association provides a travel tour program for its members and their families. Irs 2012 1040 tax forms The organization works with various travel agencies and schedules approximately ten tours a year to various places around the world. Irs 2012 1040 tax forms It mails out promotional material and accepts reservations for fees paid by the travel agencies on a per-person basis. Irs 2012 1040 tax forms The organization provides an employee for each tour as a tour leader. Irs 2012 1040 tax forms There is no formal educational program conducted with these tours, and they do not differ from regular commercially operated tours. Irs 2012 1040 tax forms By providing travel tours to its members, the organization is engaging in a regularly conducted trade or business. Irs 2012 1040 tax forms Even if the tours it offers support the university, financially and otherwise, and encourage alumni to do the same, they do not contribute importantly to the organization's exempt purpose of promoting education. Irs 2012 1040 tax forms Therefore, the sale of the travel tours is an unrelated trade or business. Irs 2012 1040 tax forms Example 2. Irs 2012 1040 tax forms A tax-exempt organization formed for the purpose of educating individuals about the geography and the culture of the United States provides study tours to national parks and other locations within the United States. Irs 2012 1040 tax forms These tours are conducted by teachers and others certified by the state board of education. Irs 2012 1040 tax forms The tours are primarily designed for students enrolled in degree programs at state educational institutions but are open to all who agree to participate in the required study program associated with the tour taken. Irs 2012 1040 tax forms A tour's study program consists of instruction on subjects related to the location being visited on the tour. Irs 2012 1040 tax forms Each tour group brings along a library of material related to the subjects being studied on the tour. Irs 2012 1040 tax forms During the tour, 5 or 6 hours per day are devoted to organized study, preparation of reports, lectures, instruction, and recitation by the students. Irs 2012 1040 tax forms Examinations are given at the end of each tour. Irs 2012 1040 tax forms The state board of education awards academic credit for tour participation. Irs 2012 1040 tax forms Because these tours are substantially related to the organization's exempt purpose, they are not an unrelated trade or business. Irs 2012 1040 tax forms Insurance programs. Irs 2012 1040 tax forms   An organization that acts as a group insurance policyholder for its members and collects a fee for performing administrative services is normally carrying on an unrelated trade or business. Irs 2012 1040 tax forms Exceptions. Irs 2012 1040 tax forms   Organizations whose exempt activities may include the provision of insurance benefits, such as fraternal beneficiary societies, voluntary employees beneficiary associations, and labor organizations, are generally exceptions to this rule. Irs 2012 1040 tax forms Magazine publishing. Irs 2012 1040 tax forms   An association of credit unions with tax-exempt status as a business league publishes a consumer-oriented magazine four times a year and makes it available to member credit unions for purchase. Irs 2012 1040 tax forms   By selling a magazine to its members as a promotional device, the organization furnishes its members with a regular commercial service they can use in their own operations. Irs 2012 1040 tax forms This service does not promote the improvement of business conditions of one or more lines of business, which is the exempt purpose of a business league. Irs 2012 1040 tax forms   Since the activity does not contribute importantly to the organization's exempt function, it is an unrelated trade or business. Irs 2012 1040 tax forms Directory of members. Irs 2012 1040 tax forms   A business league publishes an annual directory that contains a list of all its members, their addresses, and their area of expertise. Irs 2012 1040 tax forms Each member has the same amount of space in the directory, and its format does not emphasize the relative importance or reputation of any member. Irs 2012 1040 tax forms The directory contains no commercial advertisement and is sold only to the organization's members. Irs 2012 1040 tax forms   The directory facilitates communication among the members and encourages the exchange of ideas and expertise. Irs 2012 1040 tax forms Because the directory lists the members in a similar noncommercial format without advertising and is not distributed to the public, its sale does not confer private commercial benefits on the members. Irs 2012 1040 tax forms The sale of the directory does contribute importantly to the organization's exempt purpose and is not an unrelated trade or business. Irs 2012 1040 tax forms This directory differs from the publication discussed next because of its noncommercial characteristics. Irs 2012 1040 tax forms Sales of advertising space. Irs 2012 1040 tax forms   A national association of law enforcement officials publishes a monthly journal that contains articles and other editorial material of professional interest to its members. Irs 2012 1040 tax forms The journal is distributed without charge, mainly to the organization's members. Irs 2012 1040 tax forms   The organization sells advertising space in the journal either for conventional advertising or to merely identify the purchaser without a commercial message. Irs 2012 1040 tax forms Some of the noncommercial advertising identifies the purchaser in a separate space, and some consists of listings of 60 or more purchasers per page. Irs 2012 1040 tax forms A business firm identified in a separate space is further identified in an Index of Advertisers. Irs 2012 1040 tax forms   The organization solicits advertising by personal contacts. Irs 2012 1040 tax forms Advertising from large firms is solicited by contacting their chief executive officer or community relations officer rather than their advertising manager. Irs 2012 1040 tax forms The organization also solicits advertising in form letters appealing for corporate and personal contributions. Irs 2012 1040 tax forms   An exempt organization's sale of advertising placed for the purchaser's commercial benefit is a commercial activity. Irs 2012 1040 tax forms Goodwill derived by the purchaser from being identified as a patron of the organization is usually considered a form of commercial benefit. Irs 2012 1040 tax forms Therefore, advertising in an exempt organization's publication is generally presumed to be placed for the purchaser's commercial benefit, even if it has no commercial message. Irs 2012 1040 tax forms However, this presumption is not conclusive if the purchaser's patronage would be difficult to justify commercially in view of the facts and circumstances. Irs 2012 1040 tax forms In that case, other factors should also be considered in determining whether a commercial benefit can be expected. Irs 2012 1040 tax forms Those other factors include: The normal manner in which the publication is circulated; The territorial scope of the circulation; The extent to which its readers, promoters, or the like could reasonably be expected to further, either directly or indirectly, the commercial interest of the advertisers; The eligibility of the publishing organization to receive tax-deductible contributions; and The commercial or noncommercial methods used to solicit the advertisers. Irs 2012 1040 tax forms   In this situation, the purchaser of a separate advertising space without a commercial message can nevertheless expect a commercial benefit from the goodwill derived from being identified in that manner as a patron of the organization. Irs 2012 1040 tax forms However, the purchaser of a listing cannot expect more than an inconsequential benefit. Irs 2012 1040 tax forms Therefore, the sale of separate spaces, but not the listings, is an unrelated trade or business. Irs 2012 1040 tax forms Publishing legal notices. Irs 2012 1040 tax forms   A bar association publishes a legal journal containing opinions of the county court, articles of professional interest to lawyers, advertisements for products and services used by the legal profession, and legal notices. Irs 2012 1040 tax forms The legal notices are published to satisfy state laws requiring publication of notices in connection with legal proceedings, such as the administration of estates and actions to quiet title to real property. Irs 2012 1040 tax forms The state designated the bar association's journal as the place to publish the required notices. Irs 2012 1040 tax forms   The publication of ordinary commercial advertising does not advance the exempt purposes of the association even when published in a periodical that contains material related to exempt purposes. Irs 2012 1040 tax forms Although the advertising is directed specifically to members of the legal profession, it is still commercial in nature and does not contribute importantly to the exempt purposes of the association. Irs 2012 1040 tax forms Therefore, the advertising income is unrelated trade or business income. Irs 2012 1040 tax forms   On the other hand, the publication of legal notices is distinguishable from ordinary commercial advertising in that its purpose is to inform the general public of significant legal events rather than to stimulate demand for the products or services of an advertiser. Irs 2012 1040 tax forms This promotes the common interests of the legal profession and contributes importantly to the association's exempt purposes. Irs 2012 1040 tax forms Therefore, the publishing of legal notices does not constitute an unrelated trade or business. Irs 2012 1040 tax forms Museum greeting card sales. Irs 2012 1040 tax forms    An art museum that exhibits modern art sells greeting cards that display printed reproductions of selected works from other art collections. Irs 2012 1040 tax forms Each card is imprinted with the name of the artist, the title or subject matter of the work, the date or period of its creation, if known, and the museum's name. Irs 2012 1040 tax forms The cards contain appropriate greetings and are personalized on request. Irs 2012 1040 tax forms   The organization sells the cards in the shop it operates in the museum and sells them at quantity discounts to retail stores. Irs 2012 1040 tax forms It also sells them by mail order through a catalog that is advertised in magazines and other publications throughout the year. Irs 2012 1040 tax forms As a result, a large number of cards are sold at a significant profit. Irs 2012 1040 tax forms   The museum is exempt as an educational organization on the basis of its ownership, maintenance, and exhibition for public viewing of works of art. Irs 2012 1040 tax forms The sale of greeting cards with printed reproductions of artworks contributes importantly to the achievement of the museum's exempt educational purposes by enhancing public awareness, interest, and appreciation of art. Irs 2012 1040 tax forms The cards may encourage more people to visit the museum itself to share in its educational programs. Irs 2012 1040 tax forms The fact that the cards are promoted and sold in a commercial manner at a profit and in competition with commercial greeting card publishers does not alter the fact that the activity is related to the museum's exempt purpose. Irs 2012 1040 tax forms Therefore, these sales activities are not an unrelated trade or business. Irs 2012 1040 tax forms Museum shop. Irs 2012 1040 tax forms   An art museum maintained and operated for the exhibition of American folk art operates a shop in the museum that sells: Reproductions of works in the museum's own collection and reproductions of artistic works from the collections of other art museums (prints suitable for framing, postcards, greeting cards, and slides); Metal, wood, and ceramic copies of American folk art objects from its own collection and similar copies of art objects from other collections of artworks; Instructional literature and scientific books and souvenir items concerning the history and development of art and, in particular, of American folk art; and Scientific books and souvenir items of the city in which the museum is located. Irs 2012 1040 tax forms   The shop also rents originals or reproductions of paintings contained in its collection. Irs 2012 1040 tax forms All of its reproductions are imprinted with the name of the artist, the title or subject matter of the work from which it is reproduced, and the museum's name. Irs 2012 1040 tax forms   Each line of merchandise must be considered separately to determine if sales are related to the exempt purpose. Irs 2012 1040 tax forms   The sale and rental of reproductions and copies of works from the museum's own collection and reproductions of artistic works not owned by the museum contribute importantly to the achievement of the museum's exempt educational purpose by making works of art familiar to a broader segment of the public, thereby enhancing the public's understanding and appreciation of art. Irs 2012 1040 tax forms The same is true for the sale of literature relating to art. Irs 2012 1040 tax forms Therefore, these sales activities are not an unrelated trade or business. Irs 2012 1040 tax forms   On the other hand, the sale of scientific books and souvenir items of the city where the museum is located has no causal relationship to art or to artistic endeavor and, therefore, does not contribute importantly to the accomplishment of the museum's exempt educational purposes. Irs 2012 1040 tax forms The fact that selling some of these items could, under different circumstances, be held related to the exempt educational purpose of some other exempt educational organization does not change this conclusion. Irs 2012 1040 tax forms Additionally, the sale of these items does not lose its identity as a trade or business merely because the museum also sells articles which do contribute importantly to the accomplishment of its exempt function. Irs 2012 1040 tax forms Therefore, these sales are an unrelated trade or business. Irs 2012 1040 tax forms Business league's parking and bus services. Irs 2012 1040 tax forms   A business league, whose purpose is to retain and stimulate trade in a downtown area that has inadequate parking facilities, operates a fringe parking lot and shuttle bus service. Irs 2012 1040 tax forms It also operates, as an insubstantial part of its activities, a park and shop plan. Irs 2012 1040 tax forms   The fringe parking lot and shuttle bus service operate in a manner that does not favor any individual or group of downtown merchants. Irs 2012 1040 tax forms The merchants cannot offer free or discount parking or bus fares to their customers. Irs 2012 1040 tax forms   The park and shop plan allows customers of particular merchants to park free at certain parking lots in the area. Irs 2012 1040 tax forms Merchants participating in this plan buy parking stamps, which they distribute to their customers to use to pay for parking. Irs 2012 1040 tax forms   Operating the fringe parking lot and shuttle bus service provides easy and convenient access to the downtown area and, therefore, stimulates and improves business conditions in the downtown area generally. Irs 2012 1040 tax forms That activity contributes importantly to the organization's accomplishing its exempt purpose and is not an unrelated trade or business. Irs 2012 1040 tax forms   The park and shop plan encourages customers to use a limited number of participating member merchants in order to obtain free parking. Irs 2012 1040 tax forms This provides a particular service to individual members of the organization and does not further its exempt purpose. Irs 2012 1040 tax forms Therefore, operating the park and shop plan is an unrelated trade or business. Irs 2012 1040 tax forms Youth residence. Irs 2012 1040 tax forms   An exempt organization, whose purpose is to provide for the welfare of young people, rents rooms primarily to people under age 25. Irs 2012 1040 tax forms The residence units are operated on, and as a part of, the premises in which the organization carries on the social, recreational, and guidance programs for which it was recognized as exempt. Irs 2012 1040 tax forms The facilities are under the management and supervision of trained career professionals who provide residents with personal counseling, physical education programs, and group recreational activities. Irs 2012 1040 tax forms The rentals are not an unrelated trade or business because renting the rooms is substantially related to the organization's exempt purpose. Irs 2012 1040 tax forms Health club program. Irs 2012 1040 tax forms   An exempt charitable organization's purpose is to provide for the welfare of young people. Irs 2012 1040 tax forms The organization conducts charitable activities and maintains facilities that will contribute to the physical, social, mental, and spiritual health of young people at minimum or no cost to them. Irs 2012 1040 tax forms Nominal annual dues are charged for membership in the organization and use of the facilities. Irs 2012 1040 tax forms   In addition, the organization organized a health club program that its members could join for an annual fee in addition to the annual dues. Irs 2012 1040 tax forms The annual fee is comparable to fees charged by similar local commercial health clubs and is sufficiently high to restrict participation in the program to a limited number of members of the community. Irs 2012 1040 tax forms   The health club program is in addition to the general physical fitness program of the organization. Irs 2012 1040 tax forms Operating this program does not contribute importantly to the organization's accomplishing its exempt purpose and, therefore, is an unrelated trade or business. Irs 2012 1040 tax forms Miniature golf course. Irs 2012 1040 tax forms   An exempt youth welfare organization operates a miniature golf course that is open to the general public. Irs 2012 1040 tax forms The course, which is managed by salaried employees, is substantially similar to commercial courses. Irs 2012 1040 tax forms The admission fees charged are comparable to fees of commercial facilities and are designed to return a profit. Irs 2012 1040 tax forms   The operation of the miniature golf course in a commercial manner does not contribute importantly to the accomplishment of the organization's exempt purpose and, therefore, is an unrelated trade or business. Irs 2012 1040 tax forms Sales of hearing aids. Irs 2012 1040 tax forms   A tax-exempt hospital, whose primary activity is rehabilitation, sells hearing aids to patients. Irs 2012 1040 tax forms This activity is an essential part of the hospital's program to test and evaluate patients with hearing deficiencies and contributes importantly to its exempt purpose. Irs 2012 1040 tax forms It is not an unrelated trade or business. Irs 2012 1040 tax forms Nonpatient laboratory testing. Irs 2012 1040 tax forms   Nonpatient laboratory testing performed by a tax-exempt teaching hospital on specimens needed for the conduct of its teaching activities is not an unrelated trade or business. Irs 2012 1040 tax forms However, laboratory testing performed by a tax-exempt non-teaching hospital on referred specimens from private office patients of staff physicians is an unrelated trade or business if these services are otherwise available in the community. Irs 2012 1040 tax forms Selling endorsements. Irs 2012 1040 tax forms   An exempt scientific organization enjoys an excellent reputation in the field of biological research. Irs 2012 1040 tax forms It exploits this reputation regularly by selling endorsements of laboratory equipment to manufacturers. Irs 2012 1040 tax forms Endorsing laboratory equipment does not contribute importantly to the accomplishment of any purpose for which exemption is granted to the organization. Irs 2012 1040 tax forms Accordingly, the sale of endorsements is an unrelated trade or business. Irs 2012 1040 tax forms Sponsoring entertainment events. Irs 2012 1040 tax forms   An exempt university has a regular faculty and a regularly enrolled student body. Irs 2012 1040 tax forms During the school year, the university sponsors the appearance of professional theater companies and symphony orchestras that present drama and musical performances for the students and faculty members. Irs 2012 1040 tax forms Members of the general public also are admitted. Irs 2012 1040 tax forms The university advertises these performances and supervises advance ticket sales at various places, including such university facilities as the cafeteria and the university bookstore. Irs 2012 1040 tax forms Although the presentation of the performances makes use of an intangible generated by the university's exempt educational functions—the presence of the student body and faculty—such drama and music events contribute importantly to the overall educational and cultural functions of the university. Irs 2012 1040 tax forms Therefore, the activity is not an unrelated trade or business. Irs 2012 1040 tax forms Excluded Trade or Business Activities The following activities are specifically excluded from the definition of unrelated trade or business. Irs 2012 1040 tax forms Volunteer workforce. Irs 2012 1040 tax forms   Any trade or business in which substantially all the work is performed for the organization without compensation is not an unrelated trade or business. Irs 2012 1040 tax forms Example 1. Irs 2012 1040 tax forms A retail store operated by an exempt orphanage where unpaid volunteers perform substantially all the work in carrying on the business is not an unrelated trade or business. Irs 2012 1040 tax forms Example 2. Irs 2012 1040 tax forms A volunteer fire company conducts weekly public dances. Irs 2012 1040 tax forms Holding public dances and charging admission on a regular basis may, given the facts and circumstances of a particular case, be considered an unrelated trade or business. Irs 2012 1040 tax forms However, because the work at the dances is performed by unpaid volunteers, the activity is not an unrelated trade or business. Irs 2012 1040 tax forms Convenience of members. Irs 2012 1040 tax forms   A trade or business conducted by a 501(c)(3) organization or by a governmental college or university primarily for the convenience of its members, students, patients, officers, or employees is not an unrelated trade or business. Irs 2012 1040 tax forms For example, a laundry operated by a college for the purpose of laundering dormitory linens and students' clothing is not an unrelated trade or business. Irs 2012 1040 tax forms Qualified sponsorship activities. Irs 2012 1040 tax forms   Soliciting and receiving qualified sponsorship payments is not an unrelated trade or business, and the payments are not subject to unrelated business income tax. Irs 2012 1040 tax forms Qualified sponsorship payment. Irs 2012 1040 tax forms   This is any payment made by a person engaged in a trade or business for which the person will receive no substantial benefit other than the use or acknowledgment of the business name, logo, or product lines in connection with the organization's activities. Irs 2012 1040 tax forms “Use or acknowledgment” does not include advertising the sponsor's products or services. Irs 2012 1040 tax forms The organization's activities include all its activities, whether or not related to its exempt purposes. Irs 2012 1040 tax forms   For example, if, in return for receiving a sponsorship payment, an organization promises to use the sponsor's name or logo in acknowledging the sponsor's support for an educational or fundraising event, the payment is a qualified sponsorship payment and is not subject to the unrelated business income tax. Irs 2012 1040 tax forms   Providing facilities, services, or other privileges (for example, complimentary tickets, pro-am playing spots in golf tournaments, or receptions for major donors) to a sponsor or the sponsor's designees in connection with a sponsorship payment does not affect whether the payment is a qualified sponsorship payment. Irs 2012 1040 tax forms Instead, providing these goods or services is treated as a separate transaction in determining whether the organization has unrelated business income from the event. Irs 2012 1040 tax forms Generally, if the services or facilities are not a substantial benefit or if providing them is a related business activity, the payments will not be subject to the unrelated business income tax. Irs 2012 1040 tax forms   Similarly, the sponsor's receipt of a license to use an intangible asset (for example, a trademark, logo, or designation) of the organization is treated as separate from the qualified sponsorship transaction in determining whether the organization has unrelated business taxable income. Irs 2012 1040 tax forms   If part of a payment would be a qualified sponsorship payment if paid separately, that part is treated as a separate payment. Irs 2012 1040 tax forms For example, if a sponsorship payment entitles the sponsor to both product advertising and the use or acknowledgment of the sponsor's name or logo by the organization, then the unrelated business income tax does not apply to the part of the payment that is more than the fair market value of the product advertising. Irs 2012 1040 tax forms Advertising. Irs 2012 1040 tax forms   A payment is not a qualified sponsorship payment if, in return, the organization advertises the sponsor's products or services. Irs 2012 1040 tax forms For information on the treatment of payments for advertising, see Exploitation of Exempt Activity—Advertising Sales in chapter 4. Irs 2012 1040 tax forms   Advertising includes: Messages containing qualitative or comparative language, price information, or other indications of savings or value; Endorsements; and Inducements to purchase, sell, or use the products or services. Irs 2012 1040 tax forms   The use of promotional logos or slogans that are an established part of the sponsor's identity is not, by itself, advertising. Irs 2012 1040 tax forms In addition, mere distribution or display of a sponsor's product by the organization to the public at a sponsored event, whether for free or for remuneration, is considered use or acknowledgment of the product rather than advertising. Irs 2012 1040 tax forms Exception for contingent payments. Irs 2012 1040 tax forms   A payment is not a qualified sponsorship payment if its amount is contingent, by contract or otherwise, upon the level of attendance at one or more events, broadcast ratings, or other factors indicating the degree of public exposure to one or more events. Irs 2012 1040 tax forms However, the fact that a sponsorship payment is contingent upon an event actually taking place or being broadcast does not, by itself, affect whether a payment qualifies. Irs 2012 1040 tax forms Exception for periodicals. Irs 2012 1040 tax forms   A payment is not a qualified sponsorship payment if it entitles the payer to the use or acknowledgment of the business name, logo, or product lines in the organization's periodical. Irs 2012 1040 tax forms For this purpose, a periodical is any regularly scheduled and printed material (for example, a monthly journal) published by or on behalf of the organization. Irs 2012 1040 tax forms It does not include material that is related to and primarily distributed in connection with a specific event conducted by the organization (for example, a program or brochure distributed at a sponsored event). Irs 2012 1040 tax forms   The treatment of payments that entitle the payer to the depiction of the payer's name, logo, or products lines in an organization's periodical is determined under the rules that apply to advertising activities. Irs 2012 1040 tax forms See Sales of advertising space under Examples, earlier in this chapter. Irs 2012 1040 tax forms Also see Exploitation of Exempt Activity—Advertising Sales in chapter 4. Irs 2012 1040 tax forms Exception for conventions and trade shows. Irs 2012 1040 tax forms   A payment is not a qualified sponsorship payment if it is made in connection with any qualified convention or trade show activity. Irs 2012 1040 tax forms The exclusion of qualified convention or trade show activities from the definition of unrelated trade or business is explained later under Convention or trade show activity. Irs 2012 1040 tax forms Selling donated merchandise. Irs 2012 1040 tax forms   A trade or business that consists of selling merchandise, substantially all of which the organization received as gifts or contributions, is not an unrelated trade or business. Irs 2012 1040 tax forms For example, a thrift shop operated by a tax-exempt organization that sells donated clothes and books to the general public, with the proceeds going to the exempt organization, is not an unrelated trade or business. Irs 2012 1040 tax forms Employee association sales. Irs 2012 1040 tax forms   The sale of certain items by a local association of employees described in section 501(c)(4), organized before May 17, 1969, is not an unrelated trade or business if the items are sold for the convenience of the association's members at their usual place of employment. Irs 2012 1040 tax forms This exclusion applies only to the sale of work-related clothes and equipment and items normally sold through vending machines, food dispensing facilities, or by snack bars. Irs 2012 1040 tax forms Bingo games. Irs 2012 1040 tax forms   Certain bingo games are not included in the term “unrelated trade or business. Irs 2012 1040 tax forms ” To qualify for this exclusion, the bingo game must meet the following requirements. Irs 2012 1040 tax forms It meets the legal definition of bingo. Irs 2012 1040 tax forms It is legal where it is played. Irs 2012 1040 tax forms It is played in a jurisdiction where bingo games are not regularly conducted by for-profit organizations. Irs 2012 1040 tax forms Legal definition. Irs 2012 1040 tax forms   For a game to meet the legal definition of bingo, wagers must be placed, winners must be determined, and prizes or other property must be distributed in the presence of all persons placing wagers in that game. Irs 2012 1040 tax forms   A wagering game that does not meet the legal definition of bingo does not qualify for the exclusion, regardless of its name. Irs 2012 1040 tax forms For example, “instant bingo,” in which a player buys a pre-packaged bingo card with pull-tabs that the player removes to determine if he or she is a winner, does not qualify. Irs 2012 1040 tax forms Legal where played. Irs 2012 1040 tax forms   This exclusion applies only if bingo is legal under the laws of the jurisdiction where it is conducted. Irs 2012 1040 tax forms The fact that a jurisdiction's law that prohibits bingo is rarely enforced or is widely disregarded does not make the conduct of bingo legal for this purpose. Irs 2012 1040 tax forms No for-profit games where played. Irs 2012 1040 tax forms   This exclusion applies only if for-profit organizations cannot regularly conduct bingo games in any part of the same jurisdiction. Irs 2012 1040 tax forms Jurisdiction is normally the entire state; however, in certain situations, local jurisdiction will control. Irs 2012 1040 tax forms Example. Irs 2012 1040 tax forms Tax-exempt organizations X and Y are organized under the laws of state N, which has a law that permits exempt organizations to conduct bingo games. Irs 2012 1040 tax forms In addition, for-profit organizations are permitted to conduct bingo games in city S, a resort community located in county R. Irs 2012 1040 tax forms Several for-profit organizations conduct nightly games. Irs 2012 1040 tax forms Y conducts weekly bingo games in city S, while X conducts weekly games in county R. Irs 2012 1040 tax forms Since state law confines the for-profit organizations to city S, local jurisdiction controls. Irs 2012 1040 tax forms Y's bingo games conducted in city S are an unrelated trade or business. Irs 2012 1040 tax forms However, X's bingo games conducted in county R outside of city S are not an unrelated trade or business. Irs 2012 1040 tax forms Gambling activities other than bingo. Irs 2012 1040 tax forms   Any game of chance conducted by an exempt organization in North Dakota is not an unrelated trade or business if conducting the game does not violate any state or local law. Irs 2012 1040 tax forms Pole rentals. Irs 2012 1040 tax forms   The term unrelated trade or business does not include qualified pole rentals by a mutual or cooperative telephone or electric company described in section 501(c)(12). Irs 2012 1040 tax forms A qualified pole rental is the rental of a pole (or other structure used to support wires) if the pole (or other structure) is used: By the telephone or electric company to support one or more wires that the company uses in providing telephone or electric services to its members, and According to the rental, to support one or more wires (in addition to the wires described in 1 ) for use in connection with the transmission by wire of electricity or of telephone or other communications. Irs 2012 1040 tax forms For this purpose, the term rental includes any sale of the right to use the pole (or other structure). Irs 2012 1040 tax forms Distribution of low cost articles. Irs 2012 1040 tax forms   The term unrelated trade or business does not include activities relating to the distribution of low cost articles incidental to soliciting charitable contributions. Irs 2012 1040 tax forms This applies to organizations described in section 501 that are eligible to receive charitable contributions. Irs 2012 1040 tax forms   A distribution is considered incidental to the solicitation of a charitable contribution if: The recipient did not request the distribution, The distribution is made without the express consent of the recipient, and The article is accompanied by a request for a charitable contribution to the organization and a statement that the recipient may keep the low cost article regardless of whether a contribution is made. Irs 2012 1040 tax forms   An article is considered low cost if the cost of an item (or the aggregate costs if more than one item) distributed to a single recipient in a tax year is not more than $5, indexed annually for inflation. Irs 2012 1040 tax forms The maximum cost of a low cost article is $9. Irs 2012 1040 tax forms 70 for 2011. Irs 2012 1040 tax forms The cost of an article is the cost to the organization that distributes the item or on whose behalf it is distributed. Irs 2012 1040 tax forms Exchange or rental of member lists. Irs 2012 1040 tax forms   The exchange or rental of member or donor lists between organizations described in section 501 that are eligible to receive charitable contributions is not included in the term unrelated trade or business. Irs 2012 1040 tax forms Hospital services. Irs 2012 1040 tax forms   The providing of certain services at or below cost by an exempt hospital to other exempt hospitals that have facilities for 100 or fewer inpatients is not an unrelated trade or business. Irs 2012 1040 tax forms This exclusion applies only to services described in section 501(e)(1)(A). Irs 2012 1040 tax forms Public entertainment activity. Irs 2012 1040 tax forms   An unrelated trade or business does not include a qualified public entertainment activity. Irs 2012 1040 tax forms A public entertainment activity is one traditionally conducted at a fair or exposition promoting agriculture and education, including any activity whose purpose is designed to attract the public to fairs or expositions or to promote the breeding of animals or the development of products or equipment. Irs 2012 1040 tax forms   A qualified public entertainment activity is one conducted by a qualifying organization: In conjunction with an international, national, state, regional, or local fair or exposition; In accordance with state law that permits the activity to be operated or conducted solely by such an organization or by an agency, instrumentality, or political subdivision of the state; or In accordance with state law that permits an organization to be granted a license to conduct an activity for not more than 20 days on paying the state a lower percentage of the revenue from the activity than the state charges nonqualifying organizations that hold similar activities. Irs 2012 1040 tax forms   For these purposes, a qualifying organization is an organization described in section 501(c)(3), 501(c)(4), or 501(c)(5) that regularly conducts an agricultural and educational fair or exposition as one of its substantial exempt purposes. Irs 2012 1040 tax forms Its conducting qualified public entertainment activities will not affect determination of its exempt status. Irs 2012 1040 tax forms Convention or trade show activity. Irs 2012 1040 tax forms   An unrelated trade or business does not include qualified convention or trade show activities conducted at a convention, annual meeting, or trade show. Irs 2012 1040 tax forms   A qualified convention or trade show activity is any activity of a kind traditionally conducted by a qualifying organization in conjunction with an international, national, state, regional, or local convention, annual meeting, or show if: One of the purposes of the organization in sponsoring the activity is promoting and stimulating interest in, and demand for, the products and services of that industry or educating the persons in attendance regarding new products and services or new rules and regulations affecting the industry; and The show is designed to achieve its purpose through the character of the exhibits and the extent of the industry products that are displayed. Irs 2012 1040 tax forms   For these purposes, a qualifying organization is one described in section 501(c)(3), 501(c)(4), 501(c)(5), or 501(c)(6). Irs 2012 1040 tax forms The organization must regularly conduct, as one of its substantial exempt purposes, a qualified convention or trade show activity. Irs 2012 1040 tax forms   The rental of display space to exhibitors (including exhibitors who are suppliers) at a qualified convention or trade show is not an unrelated trade or business even if the exhibitors who rent the space are permitted to sell or solicit orders. Irs 2012 1040 tax forms For this purpose, a supplier's exhibit is one in which the exhibitor displays goods or services that are supplied to, rather than by, members of the qualifying organization in the conduct of these members' own trades or businesses. Irs 2012 1040 tax forms    Certain Internet activities conducted by a trade association described in section 501(c)(6) will be considered qualified convention and trade show activity if conducted on a special supplementary section of the association's website in conjunction with a trade show conducted by the association. Irs 2012 1040 tax forms The trade show itself must be a qualified convention and trade show activity. Irs 2012 1040 tax forms The supplementary section of the website must be ancillary to, and serve to augment and enhance, the trade show, as when it makes available the same information available at the trade show and is available only during a time period that coincides with the time period that the trade show is in operation. Irs 2012 1040 tax forms Conversely, Internet activities that are not conducted in conjunction with a qualified convention and trade show activity and that do not augment and enhance the trade show cannot themselves be qualified convention and trade show activity. Irs 2012 1040 tax forms Prev  Up  Next   Home   More Online Publications