Question 1. To satisfy the broadly supportedprovision to avoid cla

1. To satisfy the broadly supportedprovision to avoid classification as a private foundation, the exempt organization must satisfy both an external support test and an internal support test. Under the internal support test, more than one­third of the exempt organization’s support for the taxable year must come from gross investment income and unrelated business taxable income.

a. True

b. False

2. The excise taxes such as the tax on self-dealing and the tax on excess business holdings are imposed on exempt organizations classified as private foundations and are not imposed on exempt organizations classified as public charities.

a. True

b. False

3. Some of the excise taxes which may be imposed on private foundations may be imposed on both the private foundation and the foundation manager.

a. True

b. False

4. The purpose of the excise tax imposed on a private foundation for failure to distribute sufficient levels of income is to motivate the foundation to distribute more of its income for application to exempt purposes and thus be classified as a feeder organization.

a. True

b. False

5. The excise tax imposed on a private foundation’s investment income can be imposed as an initial (first­level) tax but cannot be imposed as an additional (second-level) tax.

a. True

b. False

6. The excise tax imposed on private foundations for excess business holdings is imposed on investments that enable the private foundation to control publicly-held rather than privately-held businesses.

a. True

b. False

7. The excise tax that is imposed on private foundations for making jeopardizing investments is imposed because the

foundation has made speculative investments that put the foundation’s income at risk.

a. True

b. False

8. The unrelated business income tax (UBIT) is calculated by multiplying unrelated business taxable income by the highest corporate tax rate.

a. True

b. False

9. Federal agencies exempt from Federal income tax under § 501(c)(1) are notsubject to the unrelated business income tax (UBIT).

a. True

b. False

10.For purposes of the unrelated business income tax (UBIT), a trade or business consists of any activity conducted for the production of income through the sale of merchandise, or from the performance of services for which profits have been earned during at least two of the five previous years.

a. True

b. False

11.The trade or business of selling merchandise where substantially all of the merchandise has been received as contributions or gifts is not subject to the unrelated business income tax, but is subject to the tax on feeder organizations.

a. True

b. False

12.A profit-related activity of an exempt organization avoids the unrelated business income tax if greater than 80% of the merchandise sold had been received as a contribution.

a. True

b. False

13.If an exempt organization conducts a trade or business that is regularly carried on by the organization, it is subject to the unrelated business income tax (UBIT).

a. True

b. False

14.For an exempt organization to be subject to the unrelated business income tax, the trade or business must notbe substantially related to the exempt purpose of the organization.

a. True

b. False

Our website has a team of professional writers who can help you write any of your homework. They will write your papers from scratch. We also have a team of editors just to make sure all papers are of HIGH QUALITY & PLAGIARISM FREE. To make an Order you only need to click Ask A Question and we will direct you to our Order Page at WriteDemy. Then fill Our Order Form with all your assignment instructions. Select your deadline and pay for your paper. You will get it few hours before your set deadline.