If an exempt organization conducts a trade or business that is regularly carried on by the organization when the business relates to the organization's exempt purpose, the organization is subject to the unrelated business income tax (UBIT).

Question

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If the trade or business is related to the organization's exempt purpose, the income generated from it is not subject to unrelated business income tax (UBIT), as UBIT applies to income from a trade or business that is not substantially related to the organization's exempt purpose.

If an Exempt Organization Conducts a Trade or Business That