Filing Your Taxes Online is Fast, Easy and Secure.
Start now and receive your tax refund in as little as 7 days.

1. Get Answers

Your online questions are customized to your unique tax situation.

2. Maximize your Refund

Find tax credits for everything from school tuition to buying a hybri

3. E-File for FREE

E-file free with direct deposit to get your refund in as few as 7 days.

Filing your taxes with paper mail can be difficult and it could take weeks for your refund to arrive. IRS e-file is easy, fast and secure. There is no paperwork going to the IRS so tax refunds can be processed in as little as 7 days with direct deposit. As you prepare your taxes online, you can see your tax refund in real time.

FREE audit support and representation from an enrolled agent – NEW and only from H&R Block

Taxslayer Com

1040ez Tax TableTurbotax For 2011 Tax YearIrsefileTax Form 1040 EzE File Amended Tax ReturnIrs Ez Forms1040 FormCan I Amend My 2013 Tax ReturnHow To File An Amended State Tax Return1040ez Free1040nr Ez 2012File State And Federal Taxes For FreePa Tax Forms 2011Filing 2010 Taxes LateOnline 1040ez2011 Tax PreparationIrs GovIrs Tax Form 2010Free 2012 Tax SoftwareAmended 1040Can I File 2011 Tax Return OnlineFile Taxes Online For FreeFile 2012 Taxes For FreeFree State Tax Filing Turbotax CodeHow To Amend My 2011 Taxes1080ez1040x TaxactFederal And State Tax Forms2012 1040x Tax FormAmended Michigan Tax ReturnHr Block LoginFree State Income Tax Forms OnlineIrs Amendment FormsTax 1040ezFederal Income Tax 1040ezFree Online Tax Filing For 2011Irs Tax Form 1040ez1040ez CalculatorDownload Ez FormHow To File Amended Tax Return

Taxslayer Com

Taxslayer com Publication 3 - Introductory Material Table of Contents What's New Reminders IntroductionOrdering forms and publications. Taxslayer com Tax questions. Taxslayer com Useful Items - You may want to see: What's New Earned income credit. Taxslayer com  The maximum income you can earn and still claim the earned income credit has increased. Taxslayer com You may be able to take the earned income credit if you earned less than $46,227 ($51,567 for married filing jointly) if you have three or more qualifying children; $43,038 ($48,378 for married filing jointly) if you have two qualifying children; $37,870 ($43,210 for married filing jointly) if you have one qualifying child; and $14,340 ($19,680 for married filing jointly) if you do not have any qualifying children. Taxslayer com See Earned Income Credit , later, under Credits. Taxslayer com Standard mileage rate. Taxslayer com  The standard mileage rate for the cost of operating your car for business use in 2013 is 56. Taxslayer com 5 cents a mile. Taxslayer com The standard mileage rate for operating your car during 2013 to get medical care or to move is 24 cents a mile. Taxslayer com The standard mileage rate for charitable use of your vehicle is 14 cents a mile. Taxslayer com Filing status for same-sex married couples. Taxslayer com  If you have a same-sex spouse whom you legally married in a state (or foreign country) that recognizes same-sex marriage, you and your spouse generally must use the married filing jointly or married filing separately filing status on your 2013 return, even if you and your spouse now live in a state (or foreign country) that does not recognize same-sex marriage. Taxslayer com See Filing Returns , later. Taxslayer com Reminders Change of address. Taxslayer com  If you change your mailing address, be sure to notify the Internal Revenue Service (IRS) using Form 8822, Change of Address. Taxslayer com Mail it to the Internal Revenue Service Center for your old address. Taxslayer com (Addresses for the Service Centers are on the back of the form. Taxslayer com ) Use Form 8822-B, Change of Address or Responsible Party—Business, if you are changing a business address. Taxslayer com Third party designee. Taxslayer com  You can check the “Yes” box in the Third Party Designee area of your return to authorize the IRS to discuss your return with your preparer, a friend, a family member, or any other person you choose. Taxslayer com This allows the IRS to call the person you identified as your designee to answer any questions that may arise during the processing of your tax return. Taxslayer com It also allows your designee to perform certain actions. Taxslayer com See your income tax instructions for details. Taxslayer com Future developments. Taxslayer com  For the latest information about developments related to Publication 3, such as legislation enacted after it was published, go to www. Taxslayer com irs. Taxslayer com gov/pub3. Taxslayer com Photographs of missing children. Taxslayer com  The Internal Revenue Service is a proud partner with the National Center for Missing and Exploited Children. Taxslayer com Photographs of missing children selected by the Center may appear in this publication on pages that would otherwise be blank. Taxslayer com You can help bring these children home by looking at the photographs and calling 1-800-THE-LOST (1-800-843-5678) if you recognize a child. Taxslayer com Introduction This publication covers the special tax situations of active members of the U. Taxslayer com S. Taxslayer com Armed Forces. Taxslayer com It does not cover military pensions or veterans' benefits or give the basic tax rules that apply to all taxpayers. Taxslayer com For information on military pensions or veterans' benefits, see Publication 525, Taxable and Nontaxable Income. Taxslayer com If you need the basic tax rules or information on another subject not covered here, you can check our other free publications. Taxslayer com See Publication 910, IRS Guide to Free Tax Services, for a list and descriptions of the different tax publications. Taxslayer com For federal tax purposes, the U. Taxslayer com S. Taxslayer com Armed Forces includes commissioned officers, warrant officers, and enlisted personnel in all regular and reserve units under control of the Secretaries of the Defense, Army, Navy, and Air Force. Taxslayer com The U. Taxslayer com S. Taxslayer com Armed Forces also includes the Coast Guard. Taxslayer com It does not include the U. Taxslayer com S. Taxslayer com Merchant Marine or the American Red Cross. Taxslayer com Members serving in an area designated or treated as a combat zone are granted special tax benefits. Taxslayer com In the event an area ceases to be a combat zone, the IRS will do its best to notify you. Taxslayer com Many of the relief provisions will end at that time. Taxslayer com Comments and suggestions. Taxslayer com   We welcome your comments about this publication and your suggestions for future editions. Taxslayer com   You can write to us at the following address: Internal Revenue Service Tax Forms and Publications Division 1111 Constitution Ave. Taxslayer com NW, IR-6526 Washington, DC 20224   We respond to many letters by telephone. Taxslayer com Therefore, it would be helpful if you would include your daytime phone number, including the area code, in your correspondence. Taxslayer com   You can send your comments from www. Taxslayer com irs. Taxslayer com gov/formspubs. Taxslayer com Click on “More Information” and then on “Comment on Tax Forms and Publications. Taxslayer com ”   Although we cannot respond individually to each comment received, we do appreciate your feedback and will consider your comments as we revise our tax products. Taxslayer com Ordering forms and publications. Taxslayer com   Visit www. Taxslayer com irs. Taxslayer com gov/formspubs to download forms and publications, call 1-800-TAX-FORM (1-800-829-3676), or write to the address below and receive a response within 10 days after your request is received. Taxslayer com Internal Revenue Service 1201 N. Taxslayer com Mitsubishi Motorway Bloomington, IL 61705-6613 Tax questions. Taxslayer com   If you have a tax question, check the information available on IRS. Taxslayer com gov or call 1-800-829-1040. Taxslayer com We cannot answer tax questions sent to either of the above addresses. Taxslayer com Useful Items - You may want to see: Publication 54 Tax Guide for U. Taxslayer com S. Taxslayer com Citizens and Resident Aliens Abroad 463 Travel, Entertainment, Gift, and Car Expenses 501 Exemptions, Standard Deduction, and Filing Information 503 Child and Dependent Care Expenses 505 Tax Withholding and Estimated Tax 516 U. Taxslayer com S. Taxslayer com Government Civilian Employees Stationed Abroad 519 U. Taxslayer com S. Taxslayer com Tax Guide for Aliens 521 Moving Expenses 523 Selling Your Home 525 Taxable and Nontaxable Income 527 Residential Rental Property 529 Miscellaneous Deductions 559 Survivors, Executors, and Administrators 590 Individual Retirement Arrangements (IRAs) 596 Earned Income Credit (EIC) 970 Tax Benefits for Education 3920 Tax Relief for Victims of Terrorist Attacks Form (and Instructions) 1040X Amended U. Taxslayer com S. Taxslayer com Individual Income Tax Return 1310 Statement of Person Claiming Refund Due a Deceased Taxpayer 2848 Power of Attorney and Declaration of Representative 3903 Moving Expenses 4868 Application for Automatic Extension of Time To File U. Taxslayer com S. Taxslayer com Individual Income Tax Return 8822 Change of Address 8822-B Change of Address or Responsible Party—Business 9465 Installment Agreement Request See How To Get Tax Help near the end of this publication, for information about getting IRS publications and forms. Taxslayer com Prev  Up  Next   Home   More Online Publications
Print - Click this link to Print this page

Tax Relief for Victims of Hurricane Irene in Pennsylvania

E-file to Remain Open through Oct. 31 for Victims of Hurricane Irene

PA-33-2011, Sept. 13, 2011

PHILADELPHIA — Victims of Hurricane Irene that began on Aug. 26, 2011 in parts of Pennsylvania may qualify for tax relief from the Internal Revenue Service.

The President has declared the following counties a federal disaster area: Bucks, Chester, Delaware, Lehigh, Luzerne, Monroe, Montgomery, Northampton, Philadelphia, Sullivan, and Wyoming. Individuals who reside or have a business in these counties may qualify for tax relief.

The declaration permits the IRS to postpone certain deadlines for taxpayers who reside or have a business in the disaster area. For instance, certain deadlines falling on or after Aug. 26, and on or before Oct. 31, have been postponed to Oct. 31, 2011. This includes corporations and other businesses that previously obtained an extension until Sept. 15 to file their 2010 returns, and individuals and businesses that received a similar extension until Oct. 17. It also includes the estimated tax payment for the third quarter, normally due Sept. 15.

In addition, the IRS is waiving the failure-to-deposit penalties for employment and excise tax deposits due on or after Aug. 26, and on or before Sept. 12, as long as the deposits are made by Sept. 12, 2011.

If an affected taxpayer receives a penalty notice from the IRS, the taxpayer should call the telephone number on the notice to have the IRS abate any interest and any late filing or late payment penalties that would otherwise apply. Penalties or interest will be abated only for taxpayers who have an original or extended filing, payment or deposit due date, including an extended filing or payment due date, that falls within the postponement period.

The IRS automatically identifies taxpayers located in the covered disaster area and applies automatic filing and payment relief. But affected taxpayers who reside or have a business located outside the covered disaster area must call the IRS disaster hotline at 1-866-562-5227 to request this tax relief.

Covered Disaster Area

The counties listed above constitute a covered disaster area for purposes of Treas. Reg. § 301.7508A-1(d)(2) and are entitled to the relief detailed below.

Affected Taxpayers

Taxpayers considered to be affected taxpayers eligible for the postponement of time to file returns, pay taxes and perform other time-sensitive acts are those taxpayers listed in Treas. Reg. § 301.7508A-1(d)(1), and include individuals who live, and businesses whose principal place of business is located, in the covered disaster area. Taxpayers not in the covered disaster area, but whose records necessary to meet a deadline listed in Treas. Reg. § 301.7508A-1(c) are in the covered disaster area, are also entitled to relief. In addition, all relief workers affiliated with a recognized government or philanthropic organization assisting in the relief activities in the covered disaster area and any individual visiting the covered disaster area who was killed or injured as a result of the disaster are entitled to relief.

Grant of Relief

Under section 7508A, the IRS gives affected taxpayers until Oct. 31 to file most tax returns (including individual, corporate, and estate and trust income tax returns; partnership returns, S corporation returns, and trust returns; estate, gift, and generation-skipping transfer tax returns; and employment and certain excise tax returns), or to make tax payments, including estimated tax payments, that have either an original or extended due date occurring on or after Aug. 26 and on or before Oct. 31.

The IRS also gives affected taxpayers until Oct. 31 to perform other time-sensitive actions described in Treas. Reg. § 301.7508A-1(c)(1) and Rev. Proc. 2007-56, 2007-34 I.R.B. 388 (Aug. 20, 2007), that are due to be performed on or after Aug. 26 and on or before Oct. 31.

This relief also includes the filing of Form 5500 series returns, in the manner described in section 8 of Rev. Proc. 2007-56. The relief described in section 17 of Rev. Proc. 2007-56, pertaining to like-kind exchanges of property, also applies to certain taxpayers who are not otherwise affected taxpayers and may include acts required to be performed before or after the period above.

The postponement of time to file and pay does not apply to information returns in the W-2, 1098, 1099 series, or to Forms 1042-S or 8027. Penalties for failure to timely file information returns can be waived under existing procedures for reasonable cause. Likewise, the postponement does not apply to employment and excise tax deposits. The IRS, however, will abate penalties for failure to make timely employment and excise tax deposits due on or after Aug. 26 and on or before Sept. 12 provided the taxpayer makes these deposits by Sept. 12.

Casualty Losses

Affected taxpayers in a federally declared disaster area have the option of claiming disaster-related casualty losses on their federal income tax return for either this year or last year. Claiming the loss on an original or amended return for last year will get the taxpayer an earlier refund, but waiting to claim the loss on this year’s return could result in a greater tax saving, depending on other income factors.

Individuals may deduct personal property losses that are not covered by insurance or other reimbursements. For details, see Form 4684 and its instructions.

Affected taxpayers claiming the disaster loss on last year’s return should put the Disaster Designation “Pennsylvania/Hurricane Irene” at the top of the form so that the IRS can expedite the processing of the refund.

Other Relief

The IRS will waive the usual fees and expedite requests for copies of previously filed tax returns for affected taxpayers. Taxpayers should put the assigned Disaster Designation in red ink at the top of Form 4506, Request for Copy of Tax Return, or Form 4506-T, Request for Transcript of Tax Return, as appropriate, and submit it to the IRS.

Affected taxpayers who are contacted by the IRS on a collection or examination matter should explain how the disaster impacts them so that the IRS can provide appropriate consideration to their case.

Taxpayers may download forms and publications from the official IRS website, irs.gov, or order them by calling 1-800-TAX-FORM (1-800-829-3676). The IRS toll-free number for general tax questions is 1-800-829-1040.

Related Information

Page Last Reviewed or Updated: 24-Mar-2014

The Taxslayer Com

Taxslayer com 3. Taxslayer com   Unrelated Trade or Business Table of Contents Selling of products of exempt functions. Taxslayer com Dual use of assets or facilities. Taxslayer com Exploitation of exempt functions. Taxslayer com ExamplesExceptions. Taxslayer com Excluded Trade or Business ActivitiesQualified sponsorship payment. Taxslayer com Advertising. Taxslayer com Exception for contingent payments. Taxslayer com Exception for periodicals. Taxslayer com Exception for conventions and trade shows. Taxslayer com Legal definition. Taxslayer com Legal where played. Taxslayer com No for-profit games where played. Taxslayer com Unrelated business income. Taxslayer com   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. Taxslayer com   Certain trade or business activities are not treated as an unrelated trade or business. Taxslayer com See Excluded Trade or Business Activities, later. Taxslayer com Trade or business. Taxslayer com   The term “trade or business” generally includes any activity conducted for the production of income from selling goods or performing services. Taxslayer com 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. Taxslayer com   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. Taxslayer com 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. Taxslayer com Regularly conducted. Taxslayer com   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. Taxslayer com   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. Taxslayer com The stand would not compete with similar facilities that a nonexempt organization would ordinarily operate year-round. Taxslayer com However, operating a commercial parking lot every Saturday, year-round, would be the regular conduct of a trade or business. Taxslayer com Not substantially related. Taxslayer com    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). Taxslayer com Whether an activity contributes importantly depends in each case on the facts involved. Taxslayer com   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. Taxslayer com 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. Taxslayer com The part of the activity that is more than needed to accomplish the exempt purpose is an unrelated trade or business. Taxslayer com   Also in determining whether activities contribute importantly to the accomplishment of an exempt purpose, the following principles apply. Taxslayer com Selling of products of exempt functions. Taxslayer com   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. Taxslayer com 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. Taxslayer com   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. Taxslayer com 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. Taxslayer com But if the organization uses the milk and cream in the further manufacture of food items such as ice cream, pastries, etc. Taxslayer com , 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. Taxslayer com Dual use of assets or facilities. Taxslayer com   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. Taxslayer com The test, as discussed earlier, is whether the activities contribute importantly to the accomplishment of exempt purposes. Taxslayer com   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. Taxslayer com The theater is a principal feature of the museum and operates continuously while the museum is open to the public. Taxslayer com 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. Taxslayer com   For information on allocating expenses for the dual use of assets or facilities, see Deductions in chapter 4. Taxslayer com Exploitation of exempt functions. Taxslayer com   Exempt activities sometimes create goodwill or other intangibles that can be exploited in a commercial way. Taxslayer com 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. Taxslayer com Unless the commercial exploitation contributes importantly to the accomplishment of the exempt purpose, the commercial activities are an unrelated trade or business. Taxslayer com   For the treatment of expenses attributable to the exploitation of exempt activities, see Deductions in chapter 4. Taxslayer com 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. Taxslayer com Sales commissions. Taxslayer com   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. Taxslayer com Artists' facilities. Taxslayer com   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. Taxslayer com These two activities do not contribute importantly to accomplishing the organization's exempt purpose. Taxslayer com Therefore, they are unrelated trades or businesses. Taxslayer com Membership list sales. Taxslayer com   An exempt educational organization regularly sells membership mailing lists to business firms. Taxslayer com This activity does not contribute importantly to the accomplishment of the organization's exempt purpose and therefore is an unrelated trade or business. Taxslayer com Also see Exchange or rental of member lists under Excluded Trade or Business Activities, later. Taxslayer com Hospital facilities. Taxslayer com   An exempt hospital leases its adjacent office building and furnishes certain office services to a hospital-based medical group for a fee. Taxslayer com 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. Taxslayer com The leasing activity is substantially related to the hospital's exempt purpose and is not an unrelated trade or business. Taxslayer com   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. Taxslayer com These activities are also substantially related to the hospital's exempt purpose and do not constitute unrelated trades or businesses. Taxslayer com Book publishing. Taxslayer com   An exempt organization engages primarily in activities that further its exempt purposes. Taxslayer com It also owns the publication rights to a book that does not relate to any of its exempt purposes. Taxslayer com 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. Taxslayer com These activities constitute a trade or business regularly conducted. Taxslayer com 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. Taxslayer com   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. Taxslayer com See Royalties under Exclusions in chapter 4. Taxslayer com School handicraft shop. Taxslayer com   An exempt vocational school operates a handicraft shop that sells articles made by students in their regular courses of instruction. Taxslayer com The students are paid a percentage of the sales price. Taxslayer com In addition, the shop sells products made by local residents who make articles at home according to the shop's specifications. Taxslayer com The shop manager periodically inspects the articles during their manufacture to ensure that they meet desired standards of style and quality. Taxslayer com Although many local participants are former students of the school, any qualified person may participate in the program. Taxslayer com 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. Taxslayer com School facilities. Taxslayer com   An exempt school has tennis courts and dressing rooms that it uses during the regular school year in its educational program. Taxslayer com During the summer, the school operates a tennis club open to the general public. Taxslayer com Employees of the school run the club, including collecting membership fees and scheduling court time. Taxslayer com   Another exempt school leases the same type of facilities to an unrelated individual who runs a tennis club for the summer. Taxslayer com The lease is for a fixed fee that does not depend on the income or profits derived from the leased property. Taxslayer com   In both situations, the exempt purpose is the advancement of education. Taxslayer com Furnishing tennis facilities in the manner described does not further that exempt purpose. Taxslayer com These activities are unrelated trades or businesses. Taxslayer com 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. Taxslayer com See Rents under Exclusions in chapter 4. Taxslayer com Services provided with lease. Taxslayer com   An exempt university leases its football stadium during several months of the year to a professional football team for a fixed fee. Taxslayer com Under the lease agreement, the university furnishes heat, light, and water and is responsible for all ground maintenance. Taxslayer com It also provides dressing room, linen, and stadium security services for the professional team. Taxslayer com   Leasing of the stadium is an unrelated trade or business. Taxslayer com 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. Taxslayer com Therefore, the income from this lease is rent from real property and unrelated business taxable income. Taxslayer com Broadcasting rights. Taxslayer com   An exempt collegiate athletic conference conducts an annual competitive athletic game between its conference champion and another collegiate team. Taxslayer com Income is derived from admission charges and the sale of exclusive broadcasting rights to a national radio and television network. Taxslayer com An athletic program is considered an integral part of the educational process of a university. Taxslayer com   The educational purposes served by intercollegiate athletics are identical whether conducted directly by individual universities or by their regional athletic conference. Taxslayer com 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. Taxslayer com 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. Taxslayer com   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. Taxslayer com 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. Taxslayer com   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. Taxslayer com The sale of the rights and the broadcasting of the events contribute importantly to the organization's exempt purpose. Taxslayer com Therefore, the sale of the exclusive broadcasting rights is not an unrelated trade or business. Taxslayer com Yearbook advertising. Taxslayer com   An exempt organization receives income from the sale of advertising in its annual yearbook. Taxslayer com 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. Taxslayer com This firm is paid a percentage of the gross advertising receipts for selling the advertising, collecting from advertisers, and printing the yearbook. Taxslayer com This advertising activity is an unrelated trade or business. Taxslayer com Pet boarding and grooming services. Taxslayer com   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. Taxslayer com These activities do not contribute importantly to its purpose of preventing cruelty to animals. Taxslayer com Museum eating facilities. Taxslayer com   An exempt art museum operates a dining room, a cafeteria, and a snack bar for use by the museum staff, employees, and visitors. Taxslayer com 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. Taxslayer com The eating facilities also allow the museum staff and employees to remain in the museum throughout the day. Taxslayer com 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. Taxslayer com Halfway house workshop. Taxslayer com   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. Taxslayer com The profits are applied to the operating costs of the halfway house. Taxslayer com 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. Taxslayer com Travel tour programs. Taxslayer com   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. Taxslayer com Example 1. Taxslayer com A tax-exempt university alumni association provides a travel tour program for its members and their families. Taxslayer com The organization works with various travel agencies and schedules approximately ten tours a year to various places around the world. Taxslayer com It mails out promotional material and accepts reservations for fees paid by the travel agencies on a per-person basis. Taxslayer com The organization provides an employee for each tour as a tour leader. Taxslayer com There is no formal educational program conducted with these tours, and they do not differ from regular commercially operated tours. Taxslayer com By providing travel tours to its members, the organization is engaging in a regularly conducted trade or business. Taxslayer com 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. Taxslayer com Therefore, the sale of the travel tours is an unrelated trade or business. Taxslayer com Example 2. Taxslayer com 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. Taxslayer com These tours are conducted by teachers and others certified by the state board of education. Taxslayer com 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. Taxslayer com A tour's study program consists of instruction on subjects related to the location being visited on the tour. Taxslayer com Each tour group brings along a library of material related to the subjects being studied on the tour. Taxslayer com During the tour, 5 or 6 hours per day are devoted to organized study, preparation of reports, lectures, instruction, and recitation by the students. Taxslayer com Examinations are given at the end of each tour. Taxslayer com The state board of education awards academic credit for tour participation. Taxslayer com Because these tours are substantially related to the organization's exempt purpose, they are not an unrelated trade or business. Taxslayer com Insurance programs. Taxslayer com   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. Taxslayer com Exceptions. Taxslayer com   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. Taxslayer com Magazine publishing. Taxslayer com   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. Taxslayer com   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. Taxslayer com 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. Taxslayer com   Since the activity does not contribute importantly to the organization's exempt function, it is an unrelated trade or business. Taxslayer com Directory of members. Taxslayer com   A business league publishes an annual directory that contains a list of all its members, their addresses, and their area of expertise. Taxslayer com 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. Taxslayer com The directory contains no commercial advertisement and is sold only to the organization's members. Taxslayer com   The directory facilitates communication among the members and encourages the exchange of ideas and expertise. Taxslayer com 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. Taxslayer com The sale of the directory does contribute importantly to the organization's exempt purpose and is not an unrelated trade or business. Taxslayer com This directory differs from the publication discussed next because of its noncommercial characteristics. Taxslayer com Sales of advertising space. Taxslayer com   A national association of law enforcement officials publishes a monthly journal that contains articles and other editorial material of professional interest to its members. Taxslayer com The journal is distributed without charge, mainly to the organization's members. Taxslayer com   The organization sells advertising space in the journal either for conventional advertising or to merely identify the purchaser without a commercial message. Taxslayer com Some of the noncommercial advertising identifies the purchaser in a separate space, and some consists of listings of 60 or more purchasers per page. Taxslayer com A business firm identified in a separate space is further identified in an Index of Advertisers. Taxslayer com   The organization solicits advertising by personal contacts. Taxslayer com Advertising from large firms is solicited by contacting their chief executive officer or community relations officer rather than their advertising manager. Taxslayer com The organization also solicits advertising in form letters appealing for corporate and personal contributions. Taxslayer com   An exempt organization's sale of advertising placed for the purchaser's commercial benefit is a commercial activity. Taxslayer com Goodwill derived by the purchaser from being identified as a patron of the organization is usually considered a form of commercial benefit. Taxslayer com 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. Taxslayer com However, this presumption is not conclusive if the purchaser's patronage would be difficult to justify commercially in view of the facts and circumstances. Taxslayer com In that case, other factors should also be considered in determining whether a commercial benefit can be expected. Taxslayer com 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. Taxslayer com   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. Taxslayer com However, the purchaser of a listing cannot expect more than an inconsequential benefit. Taxslayer com Therefore, the sale of separate spaces, but not the listings, is an unrelated trade or business. Taxslayer com Publishing legal notices. Taxslayer com   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. Taxslayer com 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. Taxslayer com The state designated the bar association's journal as the place to publish the required notices. Taxslayer com   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. Taxslayer com 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. Taxslayer com Therefore, the advertising income is unrelated trade or business income. Taxslayer com   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. Taxslayer com This promotes the common interests of the legal profession and contributes importantly to the association's exempt purposes. Taxslayer com Therefore, the publishing of legal notices does not constitute an unrelated trade or business. Taxslayer com Museum greeting card sales. Taxslayer com    An art museum that exhibits modern art sells greeting cards that display printed reproductions of selected works from other art collections. Taxslayer com 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. Taxslayer com The cards contain appropriate greetings and are personalized on request. Taxslayer com   The organization sells the cards in the shop it operates in the museum and sells them at quantity discounts to retail stores. Taxslayer com It also sells them by mail order through a catalog that is advertised in magazines and other publications throughout the year. Taxslayer com As a result, a large number of cards are sold at a significant profit. Taxslayer com   The museum is exempt as an educational organization on the basis of its ownership, maintenance, and exhibition for public viewing of works of art. Taxslayer com 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. Taxslayer com The cards may encourage more people to visit the museum itself to share in its educational programs. Taxslayer com 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. Taxslayer com Therefore, these sales activities are not an unrelated trade or business. Taxslayer com Museum shop. Taxslayer com   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. Taxslayer com   The shop also rents originals or reproductions of paintings contained in its collection. Taxslayer com 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. Taxslayer com   Each line of merchandise must be considered separately to determine if sales are related to the exempt purpose. Taxslayer com   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. Taxslayer com The same is true for the sale of literature relating to art. Taxslayer com Therefore, these sales activities are not an unrelated trade or business. Taxslayer com   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. Taxslayer com 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. Taxslayer com 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. Taxslayer com Therefore, these sales are an unrelated trade or business. Taxslayer com Business league's parking and bus services. Taxslayer com   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. Taxslayer com It also operates, as an insubstantial part of its activities, a park and shop plan. Taxslayer com   The fringe parking lot and shuttle bus service operate in a manner that does not favor any individual or group of downtown merchants. Taxslayer com The merchants cannot offer free or discount parking or bus fares to their customers. Taxslayer com   The park and shop plan allows customers of particular merchants to park free at certain parking lots in the area. Taxslayer com Merchants participating in this plan buy parking stamps, which they distribute to their customers to use to pay for parking. Taxslayer com   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. Taxslayer com That activity contributes importantly to the organization's accomplishing its exempt purpose and is not an unrelated trade or business. Taxslayer com   The park and shop plan encourages customers to use a limited number of participating member merchants in order to obtain free parking. Taxslayer com This provides a particular service to individual members of the organization and does not further its exempt purpose. Taxslayer com Therefore, operating the park and shop plan is an unrelated trade or business. Taxslayer com Youth residence. Taxslayer com   An exempt organization, whose purpose is to provide for the welfare of young people, rents rooms primarily to people under age 25. Taxslayer com 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. Taxslayer com 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. Taxslayer com The rentals are not an unrelated trade or business because renting the rooms is substantially related to the organization's exempt purpose. Taxslayer com Health club program. Taxslayer com   An exempt charitable organization's purpose is to provide for the welfare of young people. Taxslayer com 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. Taxslayer com Nominal annual dues are charged for membership in the organization and use of the facilities. Taxslayer com   In addition, the organization organized a health club program that its members could join for an annual fee in addition to the annual dues. Taxslayer com 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. Taxslayer com   The health club program is in addition to the general physical fitness program of the organization. Taxslayer com Operating this program does not contribute importantly to the organization's accomplishing its exempt purpose and, therefore, is an unrelated trade or business. Taxslayer com Miniature golf course. Taxslayer com   An exempt youth welfare organization operates a miniature golf course that is open to the general public. Taxslayer com The course, which is managed by salaried employees, is substantially similar to commercial courses. Taxslayer com The admission fees charged are comparable to fees of commercial facilities and are designed to return a profit. Taxslayer com   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. Taxslayer com Sales of hearing aids. Taxslayer com   A tax-exempt hospital, whose primary activity is rehabilitation, sells hearing aids to patients. Taxslayer com 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. Taxslayer com It is not an unrelated trade or business. Taxslayer com Nonpatient laboratory testing. Taxslayer com   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. Taxslayer com 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. Taxslayer com Selling endorsements. Taxslayer com   An exempt scientific organization enjoys an excellent reputation in the field of biological research. Taxslayer com It exploits this reputation regularly by selling endorsements of laboratory equipment to manufacturers. Taxslayer com Endorsing laboratory equipment does not contribute importantly to the accomplishment of any purpose for which exemption is granted to the organization. Taxslayer com Accordingly, the sale of endorsements is an unrelated trade or business. Taxslayer com Sponsoring entertainment events. Taxslayer com   An exempt university has a regular faculty and a regularly enrolled student body. Taxslayer com 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. Taxslayer com Members of the general public also are admitted. Taxslayer com The university advertises these performances and supervises advance ticket sales at various places, including such university facilities as the cafeteria and the university bookstore. Taxslayer com 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. Taxslayer com Therefore, the activity is not an unrelated trade or business. Taxslayer com Excluded Trade or Business Activities The following activities are specifically excluded from the definition of unrelated trade or business. Taxslayer com Volunteer workforce. Taxslayer com   Any trade or business in which substantially all the work is performed for the organization without compensation is not an unrelated trade or business. Taxslayer com Example 1. Taxslayer com 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. Taxslayer com Example 2. Taxslayer com A volunteer fire company conducts weekly public dances. Taxslayer com 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. Taxslayer com However, because the work at the dances is performed by unpaid volunteers, the activity is not an unrelated trade or business. Taxslayer com Convenience of members. Taxslayer com   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. Taxslayer com 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. Taxslayer com Qualified sponsorship activities. Taxslayer com   Soliciting and receiving qualified sponsorship payments is not an unrelated trade or business, and the payments are not subject to unrelated business income tax. Taxslayer com Qualified sponsorship payment. Taxslayer com   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. Taxslayer com “Use or acknowledgment” does not include advertising the sponsor's products or services. Taxslayer com The organization's activities include all its activities, whether or not related to its exempt purposes. Taxslayer com   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. Taxslayer com   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. Taxslayer com Instead, providing these goods or services is treated as a separate transaction in determining whether the organization has unrelated business income from the event. Taxslayer com 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. Taxslayer com   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. Taxslayer com   If part of a payment would be a qualified sponsorship payment if paid separately, that part is treated as a separate payment. Taxslayer com 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. Taxslayer com Advertising. Taxslayer com   A payment is not a qualified sponsorship payment if, in return, the organization advertises the sponsor's products or services. Taxslayer com For information on the treatment of payments for advertising, see Exploitation of Exempt Activity—Advertising Sales in chapter 4. Taxslayer com   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. Taxslayer com   The use of promotional logos or slogans that are an established part of the sponsor's identity is not, by itself, advertising. Taxslayer com 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. Taxslayer com Exception for contingent payments. Taxslayer com   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. Taxslayer com 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. Taxslayer com Exception for periodicals. Taxslayer com   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. Taxslayer com 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. Taxslayer com 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). Taxslayer com   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. Taxslayer com See Sales of advertising space under Examples, earlier in this chapter. Taxslayer com Also see Exploitation of Exempt Activity—Advertising Sales in chapter 4. Taxslayer com Exception for conventions and trade shows. Taxslayer com   A payment is not a qualified sponsorship payment if it is made in connection with any qualified convention or trade show activity. Taxslayer com 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. Taxslayer com Selling donated merchandise. Taxslayer com   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. Taxslayer com 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. Taxslayer com Employee association sales. Taxslayer com   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. Taxslayer com 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. Taxslayer com Bingo games. Taxslayer com   Certain bingo games are not included in the term “unrelated trade or business. Taxslayer com ” To qualify for this exclusion, the bingo game must meet the following requirements. Taxslayer com It meets the legal definition of bingo. Taxslayer com It is legal where it is played. Taxslayer com It is played in a jurisdiction where bingo games are not regularly conducted by for-profit organizations. Taxslayer com Legal definition. Taxslayer com   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. Taxslayer com   A wagering game that does not meet the legal definition of bingo does not qualify for the exclusion, regardless of its name. Taxslayer com 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. Taxslayer com Legal where played. Taxslayer com   This exclusion applies only if bingo is legal under the laws of the jurisdiction where it is conducted. Taxslayer com 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. Taxslayer com No for-profit games where played. Taxslayer com   This exclusion applies only if for-profit organizations cannot regularly conduct bingo games in any part of the same jurisdiction. Taxslayer com Jurisdiction is normally the entire state; however, in certain situations, local jurisdiction will control. Taxslayer com Example. Taxslayer com 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. Taxslayer com In addition, for-profit organizations are permitted to conduct bingo games in city S, a resort community located in county R. Taxslayer com Several for-profit organizations conduct nightly games. Taxslayer com Y conducts weekly bingo games in city S, while X conducts weekly games in county R. Taxslayer com Since state law confines the for-profit organizations to city S, local jurisdiction controls. Taxslayer com Y's bingo games conducted in city S are an unrelated trade or business. Taxslayer com However, X's bingo games conducted in county R outside of city S are not an unrelated trade or business. Taxslayer com Gambling activities other than bingo. Taxslayer com   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. Taxslayer com Pole rentals. Taxslayer com   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). Taxslayer com 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. Taxslayer com For this purpose, the term rental includes any sale of the right to use the pole (or other structure). Taxslayer com Distribution of low cost articles. Taxslayer com   The term unrelated trade or business does not include activities relating to the distribution of low cost articles incidental to soliciting charitable contributions. Taxslayer com This applies to organizations described in section 501 that are eligible to receive charitable contributions. Taxslayer com   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. Taxslayer com   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. Taxslayer com The maximum cost of a low cost article is $9. Taxslayer com 70 for 2011. Taxslayer com The cost of an article is the cost to the organization that distributes the item or on whose behalf it is distributed. Taxslayer com Exchange or rental of member lists. Taxslayer com   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. Taxslayer com Hospital services. Taxslayer com   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. Taxslayer com This exclusion applies only to services described in section 501(e)(1)(A). Taxslayer com Public entertainment activity. Taxslayer com   An unrelated trade or business does not include a qualified public entertainment activity. Taxslayer com 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. Taxslayer com   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. Taxslayer com   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. Taxslayer com Its conducting qualified public entertainment activities will not affect determination of its exempt status. Taxslayer com Convention or trade show activity. Taxslayer com   An unrelated trade or business does not include qualified convention or trade show activities conducted at a convention, annual meeting, or trade show. Taxslayer com   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. Taxslayer com   For these purposes, a qualifying organization is one described in section 501(c)(3), 501(c)(4), 501(c)(5), or 501(c)(6). Taxslayer com The organization must regularly conduct, as one of its substantial exempt purposes, a qualified convention or trade show activity. Taxslayer com   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. Taxslayer com 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. Taxslayer com    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. Taxslayer com The trade show itself must be a qualified convention and trade show activity. Taxslayer com 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. Taxslayer com 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. Taxslayer com Prev  Up  Next   Home   More Online Publications