Miracle, Inc., is a § 501(c)(3) organization involved in medical research. Based on its expectation that proposed legislation will adversely affect the funding supporting its mission, Miracle hires a lobbyist to work in Washington to represent its views.
Miracle is eligible for and thus makes the § 501(h) election. It calculates the lobbying nontaxable amount to be
$100,000 ($500,000 exempt purpose expenditures × 20%). The total lobbying expenditures for the year were
$115,000. Calculate Miracle's tax on excess lobbying expenditures.

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The Answer of Miracle, Inc., is a § 501(c)(3) organization involved in medical research. Based on its expectation that proposed legislation will adversely affect the funding supporting its mission, Miracle hires a lobbyist to work in Washington to represent its views.
Miracle is eligible for and thus makes the § 501(h) election. It calculates the lobbying nontaxable amount to be
$100,000 ($500,000 exempt purpose expenditures × 20%). The total lobbying expenditures for the year were
$115,000. Calculate Miracle's tax on excess lobbying expenditures.