Which of the following is an example of an exempt organization that may be subject to tax on unrelated business income?
A school that sells wrapping paper every year from October to December as a fundraiser.
A hospital gift shop that sells flowers.
A church that rents its non-debt-financed basement each month to a for-profit organization.
None of the above.
Expert Answer
ANSWER : NONE OF THE ABOVE
Reason: An activity is an unrelated business(and subject to unrelated business income tax) if its needs three requirements :
1)It is a trade or business
2) It is regularily carried on
3) It
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